When do businesses need this coverage?
The need for coverage – and when you buy it – can vary and depend on the stage of business (new vs. established), industry, and location. For instance, you may consider purchasing a Business Owner’s Policy before you even have employees. Workers’ compensation coverage, however, is normally required when you hire your first employee.
Some industries need different kinds of insurance simply based upon the nature of their work (and the inherent risks).
A roofing company will generally pay a high workers’ compensation premium, because of the physical dangers of repairing roofs. A home-based food service business that sells prepared food to retail customers from a vehicle along a route would need workers’ compensation and commercial auto insurance coverage. On the other hand, a home-based Web or software designer might not have as great a need for a Commercial Auto Policy. Speak to a licensed agent to determine the needs of your business.
Keep In Mind:
The business insurance needs of your business may also change as your organization grows. For example, your state may require you to have workers’ compensation coverage after you reach a certain number of employees. It’s important to review your insurance coverage over time to help ensure it matches your evolving business requirements and needs.
Next Question: How do you determine what your needs are?