Jean L. Serio

Aside from a knowledgeable and experienced small business lawyer and a CPA, who's your next best friend? Regardless if your business is located in your home, or in a leased space in a commercial building, your local insurance agent will be of invaluable help and an important business ally.

Whether you're an established business, or a new start-up, you may be unfamiliar with the various types of business insurance available. And may not be carrying the type that best fits your business's needs. Not only will an experienced agent know the type and amount of coverage you'll require, she will provide up-to-the-minute information on insurance regulations, and changes, which may affect your business or industry.

Here are some guidelines:

* Policies for Home Based Businesses

Your homeowners insurance policy usually does not cover your business. For instance, if a customer or employee harms someone, gets hurt or damages your home's structure, your homeowners insurance won't cover damages. Suppose you've stored business equipment or merchandise in your garage - or personal storage area - and it's stolen. It's unlikely your homeowners policy will cover that either.

In some cases, all you'll need is a policy "rider", an addendum, to your homeowners policy which includes specific coverage for your business.

* Property Damage Insurance

When you locate your business in a leased space, whether it's a commercial location, someone's home or any other type of building you're renting to house your business, all building owners require you have a policy that has property insurance coverage for the space you'll lease. This policy will cover any loss to the building owner created by your business. Generally the amount is one million or more. Before you move your business in, the building owner will require a copy of that policy.

This policy should also cover your business for such things as loss from:

- Fire - Theft - Accidents - Other catastrophes

It should cover such items as your business: equipment, merchandise, fixtures, furniture, display units, computers and other business property and assets. Any company vehicles may be covered under a separate policy.

* Liability Insurance

No sensible owner would be without liability insurance. This protects your business, and you, from possible lawsuits and financial judgments not only in cases of bodily injury, but can also cover such things as copyright or patent infringement, deceptive pricing and misleading advertising.

Generally, liability insurance protects you from claims of bodily injury made by customers, employees, and others who visit your business. For instance, say an employee, or customer, slips and falls entering your business. Your liability insurance covers this, as well as other situations spelled out in your insurance policy. It will also cover property damage caused by an employee.

* Employee Theft Insurance

If you have plans to hire employees, whether it's one or one thousand, you should have employee theft insurance. It covers theft by anyone considered an employee. This could be a part-time worker, a casual worker who comes in and cleans, or even a family member who comes in periodically. Statistics prove employee theft is still the number one reason for small business losses.

* Employment Practices Liability Insurance

This insurance is a must if you have, or are planning to have, employees.

It's unfortunate, but today it's common practice for employees to sue their employer - for a variety of reasons. Justified, or not, this lawsuit can cover anything from being fired, to believing they were sexually harassed, perceived discrimination because of sex, religion or heritage, for example.

* Product Liability Insurance

If your company produces a product, this insurance is for you. It covers customer claims for such things as, but not limited to, bodily injury. Whether you think you need it or not, it's wise to discuss it with your insurance agent before making a decision not to add it to your policies.

* Business Interruption Insurance

As the title infers, this insurance covers your business should it be temporarily closed due to any of the reasons listed in the property insurance section of your policy, such as fire. While property insurance covers the incident, itself, interruption insurance covers: expenses while the shut-down continues as well as profits lost.

* Officers and Directors Insurance

If your company is incorporated, and set up with directors and/or officers of any type, this insurance protects them against losses incurred while in the process of functioning in their particular capacity.

* Disability Insurance

Whether you're a home based or small business owner, it's important to have disability insurance for yourself. This insurance pays you when you are ill and unable to work. Many trade and professional groups provide Disability Insurance as a member benefit. Because it's a group policy, it can usually be purchased for a much lower rate than your insurer can offer. Ask your insurance agent about their rates. If they don't offer Disability Insurance they will often refer you to a company that does.

Final Word:

It's likely you'll need several of the types of business insurance covered here. Certainly property and liability. Determine the necessity of others when you meet with your insurance agent or broker. When deciding, it's better to err on the side of having too much insurance, rather than too little. Review the policy developed, with your agent, before it's formalized so you're clear about what's covered and what's not.

If your current homeowner insurance company doesn't handle business insurance, shop around. Insurance is competitive, so it's likely you'll find a company with good rates, which meets your business needs. Or, go online or ask other business owners for a referral. And remember, when your home and personal vehicles are insured by a company who does offer business insurance, it can be purchased at better rates, since they'll be handling all of your policies.

Insurance is a complex and highly regulated business. Leave it to an experienced agent, or broker, who knows the ropes.

Jean L. Serio, Copyright 2006. Are you one of the 1.2 million women tired of working the 9-5 grind, sick of worrying about making ends meet? As you know, starting your own business still remains one of the best strategies for providing you financial freedom. Discover how you can start up a business, today, with your own step-by-step Action Plan. Plus to ensure you receive all the details FREE, and learn how you can harness the power and resources you need to start, first sign up for your Free Newsletter "Start Up a Business Today" and receive your Bonus Report, "5 Mistakes Women Make Starting Up a Biz". Go to www.womensmarketingandbusinessnetwork.com "We help you make it happen!"