Why a startup may need more than just worker’s comp

workers comp

You are an entrepreneur with great ideas and strong leadership skills. You’ve identified and hired key employees, and sales are growing. Why do you need more insurance than simply state-mandated workers’ comp?

It only takes one lawsuit, natural disaster, or unplanned interruption in business to bankrupt you. Find out about the different types of insurance available for small businesses from a busy Philadelphia bankruptcy lawyer.

Business Liability Insurance

This type of insurance includes general liability insurance and commercial general liability insurance. It covers your business should someone sue you for property damage or physical injury on your site.

If you own a building or allow the public on your property, this type of coverage is a must, even if you believe that being on your property is safe. Be protected should a bystander, passer-by, or customer suffer an injury on your site, or if their car is damaged from falling debris from your building.

This type of insurance also covers you in case of libel, slander, or advertising injury claims against your company.



Professional Liability Insurance

Also known as malpractice insurance, or “errors and omissions” insurance, this type of coverage is a must for certain professionals and maybe mandated in your state. For example, it is common for attorneys, doctors, and accountants to be required to carry professional liability insurance. Even, insurance for recruitment agencies is also available.

Business Income Insurance

This type of coverage pays out if you lose business due to property damage from fire, wind, or theft. It doesn’t cover you if you or other essential personnel cannot work due to injury or illness, and income is lost.

Some insurance companies offer the following extensions to business income coverage:

  • Coverage for lost income due to absent essential personnel;
  • Coverage for lost income due to cloud service interruption;
  • Coverage for lost income due to damage to business property or tools off-site;
  • Coverage for lost income due to interruption in any utility service;
  • Coverage for lost income due to vendor or third-party inability to supply you;

Data Breach Insurance

Also called “cyber liability” insurance, data breach insurance protects you if your site is hacked or your data is stolen. For example, if due to a virus or cyberattack your customer’s personally-identifiable information is exposed, your customers or patients may sue you. Your company may face high public relations costs to repair your reputation after the breach.

Employment Practices Insurance

This type of coverage protects you against any employee claims of wrongful termination, workplace discrimination, workplace harassment, and retaliation.

When you’ve identified which types of insurance you need in addition to workers’ comp, shop around. Look for carriers that offer bundles of the type of insurance you need, and you will get a discount.

About the Author

Veronica BaxterVeronica Baxter is a legal assistant and blogger living and working in the great city of Philadelphia. She frequently works with David Offen, Esq., a busy bankruptcy and foreclosure lawyer in Philadelphia.



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