Business people who are in the process of developing a startup company may hope to delay insurance costs. Startup business insurance might feel unnecessary in the early stages, but an accident, lawsuit, or natural disaster can cause financial losses that are disruptive and costly. All businesses need one or more insurance policies to guard against risks that could sink a new venture. A business owner should consult with an attorney who can identify liability areas and recommend working with the right insurance company.
Common Reasons Startups Need Insurance:
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A landlord requires coverage to sign a building lease, often through commercial property insurance that protects your business property from property damage.
- Your new business has hired employees, which incurs the legal duty to buy a workers compensation insurance policy.
- You have investments in equipment or raw materials to protect.
- Dissatisfied customers could sue you for product or service failures, requiring errors and omissions e&o (also called E&O insurance).
- You breached a contract.
Types of Business Insurance
An Indiana lawyer could evaluate your risk profile based on size, location, products or services, staffing, and assets. Not every company needs the same levels of protection, but most need some combination of startup business insurance products.
- Commercial Property Coverage
A fire, flood, or wind storm could damage the equipment necessary to run your company. Commercial property insurance can cover replacement costs and even compensate you for lost income during downtime.
- General Liability Insurance
Most any business needs general liability coverage. Even in the startup business insurance stage, bad luck or negligence could result in injury. This policy can offset legal expenses and settlement payments for financial losses.
- Product Liability Insurance
Even if your product passes safety testing, a customer could still be injured and file a claim. This is where product liability and general insurance company protections matter for a business owner.
- Professional Liability Insurance
Also known as errors and omissions e&o, this coverage protects against mistakes, data breaches, and service-related claims. Professional liability is an essential part of startup business insurance.
Risk Does Not Wait for Success
An employee accident, injured customer, or fire can strike at any time. A startup is as vulnerable to property damage or lawsuits as a century-old company. A major mistake could derail operations before growth even begins. Appropriate startup business insurance makes it possible to recover and keep moving forward.
Legal Advice for Startup Business Planning
A business lawyer applies experience gained from many clients to each new one. To tap into a knowledge base that includes liabilities, workers compensation insurance, and contract risks, contact Webster & Garino today. Call us at (317) 565-1818.