Top Six Types of Small Business Insurance

Top Six Types of Small Business Insurance
Photo Credit: North California Department of Insurance

Small businesses operate throughout Canada, and there are different types of insurance available to them. When business owners start a business or grow the one they have, they often want to know what kind of insurance they need. It is important to find an insurance company that has experience with small business insurance and can offer the policies that you need. Take a look at the top six types of small business insurance in Canada.

#1. Small Business Credit Insurance

Many small business owners have suffered cash flow issues when their clients are late paying. This can have a huge impact on your bottom line because you may end up paying your bills late. You can get small business credit insurance to mitigate your receivables risk.

This can be beneficial if you have a period of time when your clients delay paying their bills. It gives you security and makes it easier to manage your business. This is an affordable type of insurance that is easy to manage.

#2. Cyber Liability

Another type of small business insurance is cyber liability. No matter what type of business you run, you are likely to do some business online. Anyone who goes online is at risk of a cyber-attack. Hackers target small businesses because they are often more vulnerable and don’t have the resources that big businesses have.

Your business liability insurance is unlikely to cover cyber attacks, but you can get cyber liability to protect you against DDoS attacks, malicious codes that damage your website, or viruses and worms that compromise your files.

#3. Small Business Employment Practices Liability

No matter how small your small business is, you can suffer from an allegation related to your business. Employees might file harassment charges, and it can cost you a tremendous amount of money.

This type of insurance will protect you from actual or alleged wrongful or constructive dismissal, discipline, discharge, or termination. It protects you in discrimination cases, defamation, and invasion of privacy. It also protects you in case of employment-related misrepresentation, slander, libel, and more. This type of insurance is usually part of a small business insurance policy.

#4. Employee Theft Insurance

This insurance is great for small businesses if they are concerned about employee fraud or theft. Businesses of all sizes can be the target of this kind of crime, and this is one of the most significant issues facing businesses today.

It covers you if an employee steals cash or property, as well as if a controller writes more than $90,000 in cheques to themselves. There are many ways that employees can steal from a small business, and this type of insurance protects them by reimbursing for loss of money, securities, or inventory.

#5. Umbrella

Small business umbrella insurance gives small businesses additional liability coverage that protects you beyond your standard liability policy. Most general liability policies have upper limits, and an umbrella insurance policy works when your general liability has been exhausted. It will fill in any gaps in your existing liability policy so that you are always protected.

In a worst-case scenario, you can be sued and a jury could award the other side sums of money beyond what your standard insurance covers. This is where your umbrella policy will kick in and cover you.

#6. Property Insurance

You should also consider small business property insurance to cover you in case of floods, windstorms, hail, earthquakes, acts of terrorism, and more. It can cover you in losses from fire, lightning, and other natural disasters.

You can even include vandalism and malicious harm. It offers the replacement cost value of your building and the actual cash value for your business property.

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