The entrepreneur life is great! Being self-employed or an independent contractor has many valuable benefits: more control of your time, schedule, and income. But there are some downsides.
One downside is the legal risks you face. It doesn’t matter if you’re a retail business owner, stay-at-home parent selling oils, or anything in between – being a professional increases your liability.
An extremely wise businessman once told me, “It is only a matter of time before every successful professional has an issue over liability and legalities.” It’s inevitable. Being an entrepreneur opens you up to risk.
The good news is, insurance is available to limit your exposure to these risks and help protect your income and assets. What’s better, this insurance is fairly inexpensive, especially when compared to the level of coverage you receive.
But what insurance do you need? Different types of business require unique protection. The exact insurance you need will depend on the type of business you operate. However, there are a few general insurance policies all professionals should consider.
General Liability Insurance
As a business owner, you either provide a product, service, or some combination of the two. General liability insurance typically deals with any bodily injury, personal injury, or property damage your profession may cause. Obviously no one sets out to cause these damages, but accidents happen. And worse, our society is filled with people seeking to sue businesses related to these things. For more details on what a general liability policy may include, check out this definition by Investopedia.
PRO TIP: Adding “Business Property Coverage” to a general liability policy is a common practice. It’s one of the best ways to protect any property/inventory the business owns.
Professional Liability or Errors & Omissions Insurance
If your business, or anyone associated with your it, does improper work or is negligent, the victim of the inadequate work can sue. I know what you are thinking–you and your team do great work. I believe it! Most E&O claims are a result of accidents. We’re human and we all make mistakes. This insurance helps protect against some of these mistakes.
Cyber Liability Insurance
Have you ever received an email asking you to wire money to a distant unknown prince in Nigeria who needs to escape from oppression? And if they do escape, they promise to repay you with a treasure chest of gold? Okay, maybe you haven’t fallen for that one, but what about the email that looked legitimate with an attachment or clickable link? If you open the attachment or click the link attached to SPAM, it compromises your computer. Even if you’ve never fallen for these SPAM tricksters, there is a very good chance some part of your business has an online presence. Cyber liability insurance helps protect against a breach or hack that negatively impacts your customers data or your data.
Bottom line: any business owner, contract employee, entrepreneur, multi-level marketing agent, or professional, NEEDS to consider these insurance policies. Again, they aren’t very expensive and they have extremely valuable coverage.
If you’d like an insurance quote or would like to talk with one of our wise insurance advisors about your business risks, schedule an appointment below. We would be happy to help.
