The Most Common Types of Commercial Insurance by Harry Kulakjian

Unlike personal insurance policies, commercial policies typically have much higher limits and are tailored specifically to cover specific business risks. Common coverages include property, liability, and workers' compensation coverages.

Harry Kulakjian

Errors and Omissions (E&O) insurance provides extra coverage against claims related to employees working on your project, protecting you against lawsuits that could result from errors on their part.

General Liability

General liability (also referred to as commercial general insurance or CGL) is an essential business risk management tool that protects you against bodily injury and property damage caused by your operations. Harry Kulakjian sheds light on the idea that CGL typically covers third-party medical expenses as well as repair or replacement costs should any customer property be damaged by your products or services and also covers expenses related to advertising injury claims made against marketing materials or public statements made against individuals or businesses that defame them in marketing material or statements made public by your company.

CGL policies do not offer as comprehensive of protection as whole business policies do, usually lacking workers' compensation or commercial auto coverage (these will need separate policies), repairs, or replacement costs associated with own business property; to protect this aspect of your operation, you'll require commercial property insurance (CPI).

Outside general insurance, other lines of commercial business insurance are essential for businesses that interact directly with their customers and clients. These include commercial property coverage to safeguard your building or rented equipment against damage or theft; errors & omissions for covering negligence in professional services rendered; and workers' compensation requirements in most states for employers with employees. According to Harry Kulakjian, our licensed brokers-agents can help determine which forms are necessary for your company while bundling them together at a rate often less than buying individual policies individually.

Property Insurance

Property insurance policies protect items your business owns, such as the building itself, equipment, and inventory, from fire or windstorm damage. They cover their loss or destruction due to an insured peril such as fire. They may also cover costs associated with business interruption, extra expense reimbursement, rent value losses, and crime-related liabilities.

Broker agents can assist in adding on additional forms of coverage beyond standard property insurance, such as business interruption and extra expense coverages. These time element coverages help your company manage other expenses associated with operating after experiencing a covered peril-induced loss, such as employee pay, office space rental costs, equipment rental contracts, and reasonable expenditures like employee payroll. In addition, loss of rent/rental value coverage protects against income lost if your building cannot be rented out due to covered perils.

Harry Kulakjian emphasizes that liability coverage, also called business casualty insurance, protects your company against claims arising from negligent acts and omissions by individuals and business entities that cause bodily injury and property damage to third parties. This coverage includes commercial general liability, auto, and workers' compensation policies.

Business Owners Policy (BOP)

Business Owners Policy, or BOP, is an all-in-one package that combines general liability and commercial property insurance in one comprehensive policy. BOP coverage generally applies to businesses meeting specific parameters set by insurers relating to your company's size, revenue, and location. Some coverages that don't fall into the scope of BOP, such as workers' compensation or commercial auto, may require purchasing them separately, and it might be more accessible and more affordable.

BOP provides small companies with an efficient, cost-effective solution for their most pressing business risks. It includes general liability protection and commercial property insurance to cover both real and personal assets owned by your business; additionally, business interruption coverage reimburses any income lost if an incident such as fire prevents your operation from continuing uninterrupted.

Harry Kulakjian articulates that insurance providers offering BOPs typically provide standard forms with many of the same endorsements found in monoline ISO CGL and commercial property policies. However, larger businesses that don't qualify may still find other packages suitable. BOPs are ideal for small "main street" businesses like hardware stores, barber shops, and greeting card shops that need only basic liability coverage.

Commercial Auto

Commercial auto insurance is often essential, depending on the nature of your business. This coverage protects all vehicles used for work-related activities - be they landscaping trucks or delivery vans. Furthermore, this coverage extends to drivers not employed directly by your organization who use their vehicles for work-related reasons, such as driving clients out for lunch or collecting supplies - something individual policies might not cover.

Harry Kulakjian conveys that many commercial auto policies enable you to add one single deductible per claim and provide higher limits of bodily injury liability (per person or accident), property damage liability coverage, and coverage for towing, roadside assistance, and rental car expenses. Some policies even protect non-owned or hired vehicles, such as those rented by employees or under contract agreements with another company.

Commercial auto policies, also referred to as business auto, commercial vehicle, and fleet policies, can provide crucial financial protection if an employee or vehicle involved with your company is involved in an accident, so having this coverage is essential for meeting state and federal regulations for vehicle safety as well as transport of hazardous materials.