Tips for Buying Small Business General Liability Insurance


Every small business in Texas should have some form of small business general liability insurance to cover the unexpected. You run your business to make a profit and you do not want to have to pay those profits out for damages if you are sued for some reason or if disaster strikes and takes out a portion of your assets.

One of the biggest problem small business owners report having is choosing the right type of insurance to cover the type of business that they are running. Below you will find the answers to common questions business owners ask to help you choose the right type of small business general liability insurance to suit your business needs.

What is the Purpose of Small Business Insurance?

According to the U.S. Small Business Adminstration (SBA), the purpose of having small business general liability insurance is easy really. You simply transfer a risk that you can afford to avoid a bigger risk that you cannot afford a little further down the line. In simple terms, the money that you pay for a small business liability policy today, can save you from going bankrupt if you are sued or disaster strikes even years down the line.

Who Should I Consult When Choosing a Policy?

Of course, a lawyer should look over any policies before you sign on the dotted line and your accountant should let you know what you can and cannot afford to purchase. However, you will also need to find a quality Texas insurance agent, one that is well versed in general liability coverage and other types of coverage, as well.

This insurance policy is not only important to you, it is important to the other people you are in business with, as well.

For example, if you lease the place that you have set up shop in, the property owner may very well require that you have commercial liability insurance policies in place to cover you and him if a disaster should happen.

This type of insurance will cover you and the property owner from everything to civic uprisings to smoke and natural disasters. You should talk to your insurance agent to be sure of what all is covered in any insurance policies you decide to take out.

What Risks Should be Covered?

Your property insurance should cover a wide variety of scenarios. A few of them are listed for you below.

  • Your buildings should be insured if you own them yourself; however, if you lease the buildings, then the property owner should cover your building, not the contents of the building but the building itself.
  • Your personal business property includes things like computers, chairs, desks, and personal office supplies. This should be covered under a separate policy that you obtain yourself. The property owner is not required to have this for you if you lease your property for your business from him or her.
  • Earthquakes and other disasters
  • In addition, flood insurance if it is available in your area, you should check with your insurance agent on this one, because it may be covered under a separate policy instead.

This is an all-risk policy and can be structured to cover anything you want within the policy itself, your insurance agent can help you with the policy and get you what you need.

Texas Liability Insurance

This type of general liability policy is designed to cover a third party in the event that they are hurt while in your business. The following should be covered under a policy that you buy.

  • Personal injury
  • Advertising injury
  • Fire legal liability, oftentimes, this insurance is mandatory if you lease the property that you are using for your business.
  • Completed products and operations
  • Medical expenses
  • Medical payments
  • You should also get general liability for your premises. For example, someone tripping over the corner of the carpet in your shop would be covered under this type of insurance.

You will need to talk to your insurance agent, finding out exactly what will be included in any liability insurance policy you decide to take out. You should think carefully and choose the policy that best suits your business needs, do not let a pushy agent sell you something that you will never need. You do, however, want to be covered for anything when you own your own business.

Set Your Budget

Just like any other form of business on the market today, insurance has different prices and different policies. You should get together with your accountant and decide what type of insurance you need and then set a budget that determines how much you can afford as well. Once you and your accountant have come to an agreement, that is when you will want to find an insurance agent to help you choose the right policies for you, keeping your budget in mind.

Do Your Research

You will not necessarily want to go with the first insurance agent that you come across, as they all have different prices for a wide variety of policies. Take your time, do your research, and find the best possible price for you and your business needs.

These are just a few tips to help you get the right type of liability insurance for your small business. From doing your research to setting your budget with your accountant, you will need to take your time and let your agent help you choose the best Texas small business insurance that will work the best for you and your small business needs.

For more information or for a quote please visit our commercial business insurance page at or call Ronnie Davis 254-857-8800 for a free consult.

Liability Risks and Damages – How Safe is Your Small Business?

When it comes to running a small business, there are many mistakes that can be made and many people  you have to deal with on a daily basis. From customers to vendors and from employees to contractors, it is highly possible that one of them will be hurt or claim to have been hurt when on your property at any given time.

For this reason, having small business general liability insurance to cover you and your assets is something that is indeed important and should never be skimped on.

Below you will find out the types of small business general liability insurance you can choose from and what every business owner should know about them.

The Different Types of Small Business Insurance

There are many different types of small business general liability insurance to choose from, you just have to know your types and choose the one that best protects your business. You should talk to your insurance agent, so that he can help you find the right policy for you.

Professional Liability Insurance

Also known as errors and omissions insurance, professional liability insurance protects your small business against malpractice lawsuits if you offer services instead of products. According to the profession you are in, you might be required by the state to carry this type of small business liability anyway. If you are not required by law, you need to get a policy anyway to cover your business and your personal life as well. There is nothing that can damage your business more than being sued for negligence and malpractice.

General Liability Insurance

Any type of general liability coverage is recommended if you have a small business. This type of insurance policy covers your small business if you are sued for anything from negligence to slander. The types of suits it covers you against are listed below.

  • Bodily injury
  • Medical expenses
  • Property damage
  • Slander
  • Libel
  • The cost of defending against these types of suits, which can get very expensive
  • Settlement bonds
  • Appeals processes
  • Judgments

Having a general liability policy is the only way that you can protect yourself and your small business against the ever-increasing need that Americans have to sue someone for something on a daily basis.

Product Liability Insurance

If you run a business that sells products, then you are responsible for that product and any damages it might cause. This type of insurance protects against lawsuits if a product is defective and causes any type of harm. You need to choose the amount of insurance you need to buy according to the type of product you sell.

For example, you would not need as much product liability insurance for a small clothing store as you would a mom and pop grocery. Your insurance agent can help you choose the right type and amount of insurance for you according the type of product you are selling.

Commercial Property Insurance

Business property insurance covers you from damage that happens on your commercial property. You will want to have commercial liability insurance policies in place at all times, because you can never predict when a disaster will happen. Mother Nature has a mind of her own and weather is very unpredictable.

This type of insurance covers your commercial property from the following events:

  • Fire
  • Flood
  • Vandalism
  • Smoke
  • Wind
  • Hail storms
  • Civil disobedience

Business Insurance for Home Based Businesses

It is a myth that homeowner’s insurance policies cover a home based business. You will need a separate policy to cover anything in the home related to your business needs. It is possible to add a rider to your homeowner’s insurance, but it is not going to help you very much if something happens. You should take out a separate policy, so you know that you are covered no matter what happens. You will predominantly need general and professional liability insurance in the event that you are sued for any reason.

Why Do You Need these Insurance Policies?

Many people feel that they are better off just taking their chances than they are paying the often high rates for insurance policies for a small business. Taking these extra steps with your small business can help you if you are sued for any reason. While it might not ever happen, it is best to be safe instead of sorry. The insurance will do you no good, if you wait to purchase it after you are already being sued for whatever reason.

You need to realize that one simple mistake can cost your company millions or even throw you into bankruptcy, according to the number of people your mistake harms. With good insurance policies in place, you are assured the help that you need when you need it. It is better to have the insurance and never have to use it, than it is to not have the insurance and need it badly at some point. If you have the liability, insurance that you need, you can be sure that your property and your assets are well protected in the event that something happens.

These are just a few of the types of insurance policies that you might need for your small business. Whether you run a small business, a home based business, give service, or sell products, you need to protect yourself and your property from being sued. If you feel that you do not need liability insurance or are unsure of the best kind for you, contact an insurance agent to help you right away.