Do I Need Business Insurance For My LLC?

confused woman reading small business insurance paperwork

Do I Need Business Insurance For My LLC?

| 10.29.21
Susan G.

If your business is designated as a limited liability company (LLC), you may think you have all the protection you need. After all, an LLC protects your personal assets like your home, bank accounts, and car from business bankruptcy or legal disputes. However, an LLC does not help protect your business itself from business risks. 

Having business insurance coverage helps keep your doors open and your business running. Here are the three main types of business insurance we recommend you have for your small business LLC.

Business Insurance Coverages for an LLC

Business Owner’s Policy (BOP). Why do you need a BOP if you have an LLC? Easy. Anyone on the premises where you conduct your business could slip and fall or otherwise injure themselves. If they proceed with a lawsuit, your LLC will not protect your business. It goes without saying that lawsuits are expensive! A burglar could also target your business. Without a BOP, you’d be replacing anything that could not be recovered out of your own pocket. Fires are also a common occurrence for which you’d want a BOP in place.

Professional Liability Insurance. If your LLC business involves giving professional advice, contracts, deadlines, consulting, or expertise, then professional liability insurance is for you. Also known as malpractice insurance or errors & omissions (E&O) insurance, professional liability insurance is essential for accountants, designers, computer consultants, and hairstylists. There are many professions from which professional liability insurance can benefit. 

Cyber Insurance. Virtually all businesses need to be concerned with the possibility of data breaches or cyber attacks now. It all gets complicated fast when customers are involved—was their data stolen? How will you notify them? What if ransomware hijacks your systemcan you afford the ransom? There are many reasons to seek the reassurance of having a cyber insurance policy in place.

Conclusion

While the protection offered by an LLC structure doesn’t cover every situation your business might encounter, having the right insurance is one of the many ways you can augment it. We hope the information we’ve provided helps you determine what level of coverage would benefit your LLC. 

About the Author

B2Z Insurance is a small business insurance company that provides coverage for on-the-go business owners: simple explanations, easy application, digital quotes, and mobile claims. A product that is easy-to-use and helps you assess the unique coverage needs of your business with confidence—freeing you up to grow your business.

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