Every business needs insurance. The type and amount of insurance coverage varies greatly from business to business. Seek the advice of an independent insurance agent to determine the appropriate coverage for your business. Here are some things to think about and some questions to answer before calling an insurance agent:

1.  Determine (or estimate) the dollar value of your business. Consider property owned, stock or inventory purchased. If none of these apply to your business, discuss setting a value with your agent.
2.  Choose a deductible amount you feel you can handle—$100, $200, etc. Ask about credits for taking a higher deductible.
3.  Determine if you want an actual cash value settlement or replacement cost settlement in the event of a claim.
4.  Determine the amount of liability coverage needed based on your potential exposure. In addition, consider the following types of insurance:

Worker’s Compensation—If you have one or more employees, you are required to carry Worker’s Compensation and Disability.

Disaster Insurance—Consider the worst case scenario for your business and ask about insurance coverage. For instance, if you had to have a temporary location for your business due to a disaster, is there insurance that would cover the additional cost of a temporary location?

Home-based businesses—Do not assume your homeowner’s insurance will cover your business in the home. In fact, most homeowner’s policies exclude business activities in the home. You will need additional coverage for your business assets as well as liability.

Income Replacement coverage—In the case of a sole proprietor business, being unable to conduct business could be disastrous. Consider insurance that would pay you while you are unable to work. You will need to determine in advance how long you could survive on your own funds before you would invoke the insurance. The longer you can survive without it the lower the premiums will be.