Most states have some level of required insurance that all businesses must purchase. In each state, there may be a different office that controls each sort of insurance requirement. Talk with your insurance agent about these issues. The most commonly required types of insurance for small businesses are:workers’ compensation insurance
unemployment insurance
disability insurance.;
, In most states, if your business has any employees other than yourself, you are required to have workers’ compensation insurance in order to be able to pay for their work-related injuries.For more information about the workers’ compensation requirement, most states will have a workers’ compensation office or website.
 Unemployment insurance is another form that is required by most states for business that have employees. The premiums for unemployment insurance are usually paid through regular tax withdrawals.For information about unemployment insurance, check with your state’s workforce board or other similar office.
 Disability insurance protects employees and provides lost wages that may come as a result of injury or illness, beyond the coverage of workers’ compensation. Currently, disability insurance is required in the following states:California - contact the Employment Development Department
Hawaii - contact the Unemployment Insurance Division
New Jersey - contact the Department of Labor and Workforce Development
New York - contact the New York State Workers' Compensation Board
Puerto Rico - contact the Departamento del Trabajo y Recursos Humanos/Department of Labor and Human Resources
Rhode Island - contact the Rhode Island Department of Labor and Training.
 Banks may require that any small businesses that they lend to have certain types of insurance. This is often specified in the loan contract or during the application process. For example, a small business owner may be required to have a life insurance policy in which the bank is listed as the beneficiary. This is so that the bank would recoup their loss if the owner were to die. Discuss required insurance with a loan professional at your chosen financial institution., Businesses faces many potential risks that can mean loss of physical property or expensive legal liability. For example, fire, theft, damage, obsolescence, and extreme weather can destroy products or facilities. You may be open to additional risks depending on business activities. These might include data security breaches, professional service errors, fraud, slander, international shipping mishaps, or other vulnerabilities. Assess your susceptibility to these issues and write down all of those you think could potentially affect your business., Try to figure out how likely you are to be faced with each risk you listed. For a starting point, try analyzing the probability of each risk based on several criteria. Assess each one by:


Historical risk: has such an event previously happened here or nearby?
Geographical risk: how close are you to the potential risk? For example, a business operating in the mountains may not need to worry about flooding, but might need protection from rockslides.
Property risk: What are the risks inherent to your building or property?
Organizational risk: Are there any aspects of your organization, employees, or business activities that would increase the probability of this risk?
Regulatory: Are you required to have protection from certain risks by any regulatory bodies or industry groups?You can then rank each risk from very likely to occur to very unlikely to occur., Once you've assessed the chance of facing a risk, you can assess the potential damage the event could have on your business. Try to assign a monetary value to the loss, even if its just an estimate. This will help you to assess which risks are the most potentially damaging and absolutely must be covered by insurance. For example, you can assess potential damage caused by a fire by calculating the replacement cost of your office facilities, equipment, and inventory., Make a list prioritizing your risks with high potentially losses and probability. You will want to prioritize getting insurance to cover these risks. Insurance for risks that are high probability and high risk, such as embezzlement, may not be available, so you will need another risk management strategy. However, low probability, high impact risks like fire are usually covered by insurance., Speak with the agent who provides your personal services (home, auto, health, etc.), and ask if he or she also covers business needs. Any quality agent won't hesitate to pass you on to a reputable company that specializes in business insurance if his or her company is not able to meet your business needs.
 You may want to focus your inquiries among other businesses that have something in common with yours or are a similar size., Operating a shoe repair store is different than running a two person law firm. Whatever your business is, you need an insurance agent who understands what you do. When you are meeting with prospective agents, ask about their experience working with businesses that are like yours. Get them to describe to you the kinds of businesses they have served, and the kinds of insurance they believe you need., Many states have a Department of Insurance or an Insurance Commissioner’s office as part of the state government. These agencies are charged with licensing insurance agents and monitoring their service. You can usually use this office to research your prospective insurance agent. You can find out if he or she is currently licensed or has been the subject of any complaints or criminal or ethical charges., Ask the agent for references that can provide you with an account of their experience working with him or her. Call the references and briefly get an idea of how their experience went. Make sure to listen to the references and make sure that any issues they had were quickly addressed or were not the fault of the agent., This can include profits and expenses, property information, number of employees, type of company, and potential risks and liabilities. The more information you can provide, the more productive the meeting will be.Take a physical walk through of premises so that you and your agent can identify possible areas of risks.
 Talk about what would happen if part or all of your business were lost. At this point, you need to think creatively (and your agent should help you) as you consider a variety of possible losses. Consider accidents, fire, weather damage, injury to staff or customers, and anything else you think could possibly happen. At this point, you need to consider the worst., If that location were no longer there due to fire or other disaster, could you easily relocate the business to operating capacity in a short amount of time? Look at coverage to replace your building if you own it, or consider coverage to protect your business if you lease or rent office space., Most business insurance policies will replace your equipment with either the same item, or a comparable one, instead of only giving you the depreciated value on the piece. Discuss this with your agent, though, to make sure that this applies to the policy that you are considering., Your insurance needs will be different if you have employees or will have customers on your business premises. You need to consider what could happen to customers or employees while in your office or storefront, including potential injuries. If someone is injured there, you will likely be held responsible and could face an expensive lawsuit. Depending on the injury, you could be out hundreds of thousands of dollars or more, which could be financially crippling for your business. You need to discuss all these issues with your agent when selecting a policy.,, If something happens that forces you to shut your business for a brief period, you could lose significant income from loss of customers or a decrease in sales. Business interruption insurance will help protect you against this sort of loss., Business life insurance will protect against loss of income that may come as a result of significant injury to death to an employee or staff member. This is an option that you may need to consider if you have few employees, so that the absence of any one could result in a significant loss to the company., If you are in the medical field, have a law office, or some other business that provides professional services, you may need to buy professional liability or malpractice insurance. This will protect you in case of loss due to errors or negligence in rendering professional service or advice.Businesses that primarily sell products should also consider product liability insurance, which protects them from legal action taken in reaction to the use of their products., If you run a food truck, a transportation service, or anything else that relies on the use of motor vehicles, you will need auto insurance. Talk with your insurance broker about differences between auto insurance for a business and auto insurance for usual residential use.For example, if you operate a transportation service, you will be driving more miles than most people who insure cars for simple family use. You will also have strangers inside the car, leading to the possibility of damage, vandalism or increased cleaning needs.
 If you have employees working for you, you will need to have coverage in case they get injured on the job, or to cover for possible unemployment. In many states, these coverages are required. You will need to check with your state’s insurance commissioner or talk with your insurance agent., Available to you and your employees are options such as group life insurance, group health insurance and disability insurance. You can choose to cover these expenses yourself as the business owner, or most companies allow the employees to opt in by covering some of the costs., Business insurance is actually a variety of specialized coverages in a single policy or different policies to cover the risks a business might face.Most small business owners will have a general business policy, much like a homeowner has a comprehensive homeowner’s policy. This type of policy will provide a combination of protections of liability and property insurance.Read over the plan again to ensure that the coverages provide adequate protection for all risks.
Research your state’s insurance requirements.
Carry workers’ compensation insurance to protect against employee injuries.
Pay for unemployment insurance through taxes.
Buy disability insurance in limited locations.
Identify contractual requirements for insurance.
Review potential risks.
Assign a probability level to each risk.
Assess potential impact on your business.
Prioritize risks with high impact.
Consult with your personal insurance agent or company.
Get referrals from business colleagues or friends.Ask other small business owners for referrals to insurance agents they know and are pleased with.
Find someone who understands your business.
Research the agent’s license.
Check the agent's references.
Be prepared for your first agent appointment with a full listing of company information.
Discuss potential losses with your agent.
Start with your property or location.
Talk about a full inventory of your equipment.
Consider injuries or harm to employees or customers.
Purchase casualty or property insurance to protect physical assets.

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Consider business interruption insurance to protect against temporary closures.
Get Key Man insurance for particularly small business operations.
Think about buying professional liability coverage for some professional service businesses.
Purchase auto insurance if your business owns and relies on vehicles.
Get workers’ compensation and unemployment insurance to cover your employees.
Consider adding comprehensive coverage.
Select general business owner’s insurance to cover most needs.
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