4 Types of Insurance Every Small Business Owner Should Have

Business owners usually know that they need liability insurance in case they get sued for defective products, or anything similar, and worker's compensation insurance for any employees on their payroll. However, there are many other types of insurance that should be considered by a small business owner in order to protect the business and their finances. Note a few suggestions.

1. Business interruption insurance

Many small business owners rely on a variety of factors to keep their business running, and anything that interrupts those factors can mean a complete shutdown of the business. As an example, a roofing contractor may not have storage space for new roofing tiles and relies on a certain vendor to deliver these to a jobsite. If that vendor fails to do this and the roofing contractor cannot easily find replacement materials, their entire business may come to a standstill. Business interruption insurance can reimburse a business owner for lost revenue due to these types of circumstances.

2. Data breach insurance

If someone were to hack your computer files, steal paperwork from your office, or otherwise breach confidential information about customers, clients, or employees, you could be liable for any damage done with that information. Data breach insurance can cover this liability. If you work with very sensitive information for legal or accounting clients or are employed to design prototypes of certain equipment, data breach insurance should be considered for your company.

3. Renter's or property insurance

If you run your small business from your home, you need renter's or property insurance that will cover the cost of replacing your computer and other office equipment or damage done to your home from storing tools and other items you use for contracting work. Be sure that the insurance policy includes these business items above and beyond standard household goods; if they're not written into the policy specifically, your insurance carrier may refuse to cover the cost, as they were only providing for household items and not business items.

4. Umbrella coverage

An umbrella coverage or policy can include just about any type of liability that your insurance carrier will provide. This might be insurance against errors you might make as a professional, property insurance if you operate your business in an outside location such as a garage or store, and the like. It might also extend the coverage amounts of other policies in place. Ask a professional insurance carrier, like Elders Insurance, about an umbrella policy or coverage and what it might include if there are specific circumstances and risks you want to have covered.