As the owner of one of a small business, having business insurance is a must. While most companies start with a business owners policy (BOP), commercial vehicle insurance, and similar basics, they might not offer all of the coverage you’re after. Fortunately, there is a variety of specialty business insurance options available. Here’s a look at five unique types of business insurance available on the market.
Data Breach Insurance
Data breach insurance – also referred to as cyber liability insurance – offers protection in situations where personally identifiable information (PII) held by your company is stolen or lost. The coverage primarily addresses thefts or losses related to cybercrime, such as a hack, along with damage caused by viruses. Some also cover data leak events involving the accidental exposure of PII, though every policy is different.
A data breach insurance policy provides financial assistance to ensure you can quickly notify impacted individuals or businesses, offer credit monitoring to those affected, and work to recover your company’s reputation. Since the average cost of managing a data breach in the US is $9.44 million, it’s an intelligent type of protection to add if your company handles PII.
Hazard Insurance
Hazard insurance is a policy that protects the building you’re operating out of, along with the equipment your company needs to operate. If the physical structure is damaged in an incident like a fire, the policy will help cover the cost of repairs. If equipment is harmed during a qualifying event, the policy also assists with repair and replacement costs.
Along with property owned by the company, hazard insurance can apply to rented property, as well. As a result, it ensures that any harm to rented property during a qualifying incident isn’t something you have to address out-of-pocket.
Product Liability Insurance
For companies that manufacture products, product liability insurance is a potentially critical type of protection. It gives you financial support if your product harms a third party or if a product-related lawsuit is levied against the company.
For example, if a customer bought your product and it shattered under everyday use, physically harming the person in the process, they could potentially sue. Product liability insurance would help provide you with the means to navigate this possibly tricky situation without having to pay for it all out of pocket.
Business Overhead Insurance
Business overhead insurance – also called business overhead expense insurance or business expense insurance – handles costs relating to operating your business if you suddenly become disabled and can’t operate. It addresses expenses like employee salaries and utility bills, allowing you to ensure those expenses are appropriately covered. However, it doesn’t offer a salary to you, the business owner, so keep that in mind.
Key Person Insurance
Key person insurance is a policy that replaces lost revenue if the covered individual passes away. Typically, a key person is an executive or similarly upper-level individual related to the business that has a significant impact on profitability. Essentially, it’s not unlike many other death benefits, such as a life insurance policy; it’s simply taken out by an employer instead of a family member.
