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Business insurance

Posted October 22, 2014 in Advice Column, Beaverdale

Business insurance is coverage that protects businesses from losses due to events that may occur during the normal course of business. There are many types of insurance for businesses, including coverage for property damage, legal liability and employee-related risks.

The insurance industry loves its jargon. And unless you’re around it every day, as I am, there is a strong possibility it might leave you scratching your head. Although states may vary in their insurance requirements, here’s a brief overview of the primary types of coverage.

Property coverage pays for losses sustained to property, including:
•    Direct physical loss to your building, including any completed additions, fixtures, permanently installed machinery and equipment and personal property used to maintain or service the buildings or structures, such as fire-extinguishing equipment, outdoor furniture, floor coverings and appliances.
•    Direct physical loss of your property used in the business, property of others in your care, custody or control and, if you’re a tenant, improvements and betterments that you make.
•    Actual loss of business income due to necessary suspension of your operations during the time it takes to restore operations after a covered loss.

Crime provides coverage for employee dishonesty, money and securities, forgery/alteration and counterfeit paper currency.

Liability provides coverage if you become legally obliged to pay damages as a result of business operations.

Business auto provides coverage for a variety of vehicle types you may use in your business, including passenger vehicles, trucks and vans.

Commercial umbrella provides coverage above the liability limits of your underlying policies such as your business owners liability, general liability, business auto liability and employers liability policies. It affords broader coverage than primary policies for some risks and under some circumstances.

Workers’ compensation addresses the medical and financial aspects of employment-related injuries, providing medical and disability benefits. It also includes employers liability coverage.

Cyber liability and data breach expense provides third-party liability coverage for information security and privacy coverage, regulatory defense/penalties and privacy-breach response services.

Employment practices liability covers allegations of discrimination, harassment, inappropriate employment conduct and associated defense costs.

Computer and data pays for direct physical loss or damage to electronic data processing equipment.

Spoilage pays for damage to your personal property (normally food) because refrigerating equipment has failed or broken down.

Valuable papers and records covers direct physical loss or damage to valuable papers and records caused by a covered cause of loss.

Information provided by Larry G. Novak, Novak Agency of Farmers Insurance

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