The New Year is a great time to review your business insurance policies.
Identify what coverage you have, what coverage you may need, and confirm your business is adequately protected in the event of a loss. Specifically, make sure you have the right insurance coverage for your small business and make sure you carry sufficient amounts of coverage.
There is no one-size-fits-all on sufficient coverage or limits. The following are the primary types of business insurance offered in North Carolina:
- Liability Insurance – Liability insurance covers your business in the event an allegation of wrongdoing is made against the company resulting in damage or injury to another. Liability insurance can cover a broad range of claims. For example, if someone claims he slipped and fell at your business, your liability coverage would come in to play. It can also provide coverage if a service appointment or install is done improperly damaging someone’s property.
- Property Insurance – Property insurance can protect not just real property (the building itself), but also the contents, including office equipment, inventory, tools, etc. This will protect you in the event of a fire, vandalism, storm, etc. You can also add business interruption coverage in the event operations are interrupted due to a loss.
- Business Owner’s Policy – A Business Owner’s Policy (BOP) combines property and liability insurance. It can also include lost income insurance when operations must be suspended due to a covered loss. This coverage can be tailored to meet the individual needs of a particular business. It can include loss inventory, damage to a physical location, and injuries to customers on your premises.
- Commercial Flood Insurance – Commercial flood insurance can insure a business’ location and contents from rising flood waters.
- Workers’ Compensation – Any business in North Carolina that employees three or more employees must obtain workers’ compensation insurance. This provides coverage to employees who are injured on the job.
- Commercial Auto Insurance – If you have commercial automobiles, you need a separate policy of insurance. Do not rely on a personal auto policy to provide adequate coverage. Also, your personal auto policy may exclude coverage if the automobiles are being used for business purposes. If employees drive their own cars on company business, ensure you have additional coverage to protect the company if the employee has insufficient coverage.
- Professional Liability Insurance – Errors and Omissions Insurance provides coverage for improperly rendering professional services. Your general liability insurance typically will not cover professional liability. This coverage is necessary for those involved in providing skilled, professional services, including real estate agents, lawyers, accountants, medical providers and the like.
- Cyber Security Liability Insurance – Cyber liability insurance is quickly becoming commonplace for businesses who store customer data. All businesses that use computers connected to the internet are at risk of a cyberattack by hackers. In North Carolina, businesses can carry first-party coverage or third-party coverage. First-party coverage insures the business for forensic costs of determining how the breach occurred and state required notification to customers. Third-party coverage allows protection for lawsuits and fines for exposure of customers’ personal data. It should be noted that most general liability insurance excludes cyber liability insurance, so separate coverage is necessary to protect your business in the event of a cyberattack.
While not a comprehensive list, the above is a good starting point for reviewing your business coverages. Sit down with your insurance agent or insurance attorney and verify the coverage you have will adequately protect your business in the event a claim is made against your business or your business suffers a loss or damage.
Deedee Gasch has over a decade of experience litigating catastrophic claims involving serious injury or death. While Deedee’s practice is primarily focused on the defense of premises liability, trucking and commercial vehicle accidents, and medical malpractice, she also has a wide range of civil litigation experience. She spent approximately half of her career representing injured plaintiffs before returning to her first love of civil litigation defense work. This experience on both sides of a case uniquely situates her in negotiations and at trial if settlement is not possible. Deedee is a third-generation Tar Heel and attorney, following in the footsteps of her grandfather, a North Carolina Resident Superior Court Judge (deceased), and her father, a career trial lawyer. She has dual degrees in Journalism and Political Science and earned her law degree cum laude from Florida Coastal School of Law in Jacksonville, Florida, where she attended on a prestigious merit based scholarship. She is licensed to practice law in both North Carolina and Florida.