What is Commercial Insurance? Here’s Everything You Need to Know

commercial insurance education

Starting a business doesn’t just require action. It requires strategic planning.  

Sales, marketing, product development, and customer service are just a handful of factors that you have to create plans for — and those plans will determine whether or not your company succeeds. 

However, before you start brainstorming ideas and winning strategies for your business, you have to take a step back and consider the foundation you’re building your company on. Are you growing a business on solid ground to protect it from crumbling if something goes wrong? 

Do you have a strategic plan that can guarantee your business stays standing if a natural disaster hits your company, an accident happens on the job, or an unplanned disruption affects your cash flow, causing you to lose income? 

If not, then you need to learn about commercial insurance. It’s a crucial part of the rock-solid foundation that you should build a company on. 

What is commercial insurance?

The definition of commercial insurance is simple. It’s insurance that protects your company and employees. 

While glossed over, it’s important to remember that commercial insurance isn’t just beneficial for your business. It’s beneficial for everyone who works with you.

It protects your company and your employees from accidents, crime, disasters, liability, and financial loss if a tragic event impacts business activities. By having commercial insurance, you’re giving yourself and your employees peace of mind knowing that the worst of the worst could happen, but you’re still covered. 

what is commercial insurance?

Are there different types of commercial insurance? 

While not commonly known, there are various types of commercial insurance. And as a business owner, it’s your responsibility to assess the risks your company could face to determine the best coverage to get.

Your primary goal should be avoiding financial loss. As such, you’ll need to consider your business’s vulnerabilities and assets to choose the policies that fit your needs. Many types of commercial insurances can help prevent financial ruin. But to keep things simple, here is a handful of important policies for you to contemplate. 

1. Commercial Auto Insurance 

It’s not uncommon to have a motor vehicle for your business operations. Whether it’s a car, van, or truck, you might find that it’s imperative for your company to have a commercial vehicle to be successful. 

If this is the case, you should think about getting commercial auto insurance. This coverage will protect you if someone steals or damages your commercial vehicle. And what’s even better is that it’ll cover your employees who are responsible for driving your company’s cars, vans, or trucks.

When you have commercial auto insurance, you’ll have a policy in place that covers your losses in various scenarios, including: 

  • Medical payments 
  • Theft
  • Vandalism
  • Bodily injury liability
  • Collision coverage
  • Property damage liability 

With so many benefits, getting commercial auto insurance will be critical if you have business vehicles. 

2. Business Disruption Insurance

Sometimes, you can experience financial loss because of an unplanned event. For example, a pandemic, natural disaster, or fire could affect your business activities, leading you to miss sales targets and lose money. 

For these unpredictable and tough situations, business disruption insurance is ideal. It’ll cover your losses during the time that your company’s operations are stalled. For example, business income insurance will cover: 

  • Loan payments 
  • Taxes
  • Lost profits 
  • Rent
  • Mortgage payments 
  • Moving to a temporary location
  • Employee wages

With this policy in place, you can rest easy knowing that your company is safe and secure if an unfortunate event occurs. 

3. Commercial Property Insurance 

Unless you run a remote workforce, property insurance is critical. If your company operates in a physical location, you need a policy to cover the building, equipment, and land. 

If your property is stolen, vandalized, or damaged because of a natural disaster or fire, commercial property insurance guarantees that your business and employees are covered. 

4. Workers Comp

If you plan to have employees, you need to think about worker’s comp. This type of insurance covers businesses that have employees, and it’s typically required in most states. 

Your employees want to work for a company that protects them, and some states appeal to this desire by demanding business owners get workers comp. 

With this insurance, you’ll have a policy that pays out benefits to employees who become disabled, sick, or injured on the job. And if the worst-case scenario happens where an employee dies because of a work-related event, the employee’s family will receive the benefits. 

Getting workers comp ensures you give employees the protection they need and your business the coverage it needs. Quite simply, without this insurance, your business could get sued or experience significant financial loss if an employee gets hurt, sick, or dies because of work.

5. Business Owner’s Policy 

If you’re a small business owner, there’s commercial insurance that’s specifically tailored to your needs. Business Owner’s Policy provides small businesses with liability and property and income protections.

This type of policy is great if you need a combination of a few things instead of a full suite of coverage. It includes business income insurance, commercial property insurance, and commercial general liability insurance, which are crucial policies for most small businesses.

Do you need to get commercial insurance?

Despite the various reasons for getting commercial insurance — like covering financial loss if your company experiences a crime, natural disaster, theft, or vandalism — you still might be wondering if you actually need commercial insurance. 

The short answer? Yes. 

Unless you want to pay out of pocket when something goes wrong, you need this type of insurance. You don’t want to pay thousands of dollars if your company gets flooded or encounters a liability claim.

Those types of scenarios can lead to financial ruin, especially if you’re a small business owner. 

How much does commercial insurance cost? 

how much does commercial insurance cost?

Once you decide to get commercial insurance and know which policies are necessary, you’ll want to find an insurance company that’s going to provide you a reasonable rate. 

Most insurance providers are going to assess various factors when determining your costs, including: 

  • The type of company you have
  • Where your business is located
  • Your gross annual income 
  • How many employees you have
  • How long you’ve been in business
  • Any commercial property that you own
  • Any commercial vehicles you own 
  • The training resources and procedures you have for employees

All of these elements will determine how much you pay for your commercial insurance. Some policies are more expensive than others, but generally, each policy is less than $100. 

How to get commercial insurance

Getting commercial insurance is easy. There are plenty of providers who offer this policy. However, the hard part is determining which insurance provider to choose. 

You should work with a company that has knowledgeable agents, reasonable rates, and your best interest in mind. And Barry Risk Management, Inc. meets these criteria. 

Our parent company is Barry Risk Management, a business that specializes in helping people find and purchase the proper coverage for all of their everyday essentials.

With Barry Risk Management, Inc., you’ll find guidance, great policies, fair prices, and a company that protects you and your employees when things go wrong. If something bad ever happens, you can count on Barry Risk Management, Inc. to help you out. 

Don’t start your business on a rocky foundation by going with a terrible insurance agency. Set you and your employees up for success by working with an insurance company that wants to see you succeed. 

Use Barry Risk Management, Inc. to protect your company from financial loss.

For commercial insurance, contact Barry Risk Management, Inc. today to speak with a representative.