If you are starting a business in New York, you might be asking a lot of questions, and rightfully so.
One of those questions might be, what type of insurance do I need for my business.
Now, this is going to depend on the type of business you are starting or you have but today I am going to break down the basic insurance policies that all businesses need to know and understand when starting a business in NY.
General Liability
General liability insurance is also known as Commercial General Liability (CGL) Insurance and is the basic liability coverage that is going to help protect your business. Protecting you if someone sues you for causing property damage or bodily injury.
This coverage is either purchased on a standalone basis or packaged on a Business Owner’s Policy (BOP)
The difference between the two is that a Business Owner’s Policy also includes coverage for property owned by the business along with additional coverage’s like Loss of Business income or Employee Theft.
Commercial Auto
Any business will need some sort of auto coverage protection. If the business owns vehicles in their name or uses it every day of the operation it needs to have Business Auto coverage.
Business auto protection will be similar to a regular car insurance policy but rated and covered the proper way so if an accident occurs the business is protected.
If the business does not own vehicles it still should have a certain coverage called Hired & Non-owned Liability Coverage.
Hired and non-owned auto liability coverage is the coverage to protect you in the event of bodily injury or property damage caused by vehicles that you hire like a rental vehicle and also non-owned vehicles like your employee’s vehicles.
All businesses should carry hired & non-owned liability coverage to help protect their business in the event of an accident.
Examples of this can be simple as you sending an employee to run an errand for you. If they get in an accident that causes major property damage or injuries, your business could be at risk.
This coverage can be added to either your commercial auto policy or if you don’t have a commercial auto policy, then to your business owners or business package policy.
Worker’s Compensation
The moment your business hires employees or works as a subcontractor for another business it will be required by New York State Law to have worker’s compensation insurance.
Workers’ Compensation is insurance that provides medical expenses and lost wages for workers who are injured or become ill as a direct result of their job.
Employers are required to pay for this insurance and can not require employees to contribute to the cost of compensation.
Worker’s compensation rates are determined by the NY Worker’s Comp Board and are initially based on the industry you are in and the type of job you perform.
Any time you have Worker’s compensation coverage you also need to package it with a short term disability policy.
Short-term Disability
New York is one of a handful of states that require employers to cover employees for injuries or illnesses that happen off duty.
Coverage for disability benefits is usually obtained through a different insurance carrier than your Worker’s Compensation and only a handful of insurance carriers still offer it.
Disability benefits are temporary cash benefits paid to an eligible wage earner when they have been deemed unable to work by an off duty injury or illness.
Short term disability policies now include a separate part called Paid Family Medical Leave that was introduced to New York in 2018.
Other Insurance Policies
As mentioned each business is different and there are a handful of other policies that are most likely a must for business owners to have or at least look at to protect themselves.
These include:
- Professional Liability -Errors & Omissions Coverage
- Directors & Officers Liability Coverage
- Cyber Liability coverage
- EPLI- Employers Practice Liability Insurance
The most important thing you can do as a business owner whether you are just starting up or have been in business for years is to find a trusted insurance advisor to help you.
Your insurance agent should be one of the 5 more trusted “business partners” you have that help guide you in the right direction. Going hand in hand with your accountant, attorney, and banker.
If you don’t have a relationship with an agent or want a review of your insurance then click the button below to schedule a review with one of our trusted insurance advisors.
