Running a company without business insurance can have financial and legal consequences that follow your business long after an incident occurs. Understanding what’s at stake is the first step toward making an informed decision about coverage.

What Are the Consequences of Being Uninsured?

California and most other states require applicable businesses to carry specific types of coverage, including workers’ compensation and commercial auto insurance. Operating without state-required minimums can result in fines, penalties or forced closure. Contracts with vendors, landlords and clients often require proof of insurance, so the absence of a business policy may void agreements before work ever begins.

Without business insurance, your business would need to absorb the full cost of a lawsuit, property damage or employee injury. Legal fees, medical bills and settlements are paid out of pocket, which can drain accounts and destabilize operations. A single claim can exceed what many small businesses keep in reserve. Creditors or courts may pursue personal assets when business funds fall short.

What Coverage Does Your Business Need?

Business insurance generally refers to a collection of insurance policies matched to your specific risks. Common options include the following:

• General liability insurance may financially protect against third-party claims of bodily injury, property damage or personal and advertising injury.
• Commercial property insurance may cover physical assets, including but not limited to buildings, equipment and inventory.
• Business interruption insurance may pay for lost income and recurring expenses after a covered incident forces your business to pause operations.
• Workers’ compensation insurance may financially support employees with work-related injuries or illnesses.
• Commercial auto insurance may cover vehicles used for work purposes.
• Professional liability insurance may help with claims arising from errors or omissions in your professional services.
• Cyber liability insurance may address costs related to data breaches and other cyber threats.
• Commercial umbrella insurance may extend the limits of your underlying liability policies.

Do Coverage Levels Matter?

Your industry, number of employees, physical location and the nature of your operations can all influence what coverage you need and what your premiums will reflect. Underinsuring to reduce costs can leave significant gaps that become costly problems later.

Contact Us

The risks of operating uninsured are too significant to set aside. Contact Gerhart, Hartman & Ritner, Ltd. today to learn more about your options and get optimal coverage for your business.