May 24, 2018 | John Casagrande

The Top 5 Myths About Business Insurance In New Jersey

Owning your own business comes with many benefits and many challenges.  As an entrepreneur, you know this all too well. Your initiative and accomplishments have afforded you some level of control over your schedule, your employees, your associates and your customers.  However, this also means you are responsible for all aspects of your business, including managing its risk. Fortunately, this is why we have business insurance. With the right insurance for your business, your investment will be protected, allowing you to focus on what you do best.

Before you consider entering into an insurance policy for your business, it’s important to separate fact from fiction. Let’s explore the top five myths about business insurance in New Jersey so you can be more informed.

 

Myth 1. Small businesses do not need insurance.

Astonishingly, roughly 50% of small business owners do not carry business insurance.  Some businesses are concerned about perceived cost or usability issues, so they choose to forgo insurance altogether.  It is important to recognize that business insurance is essential for all companies, regardless of size. For a small business owner in N.J., it only takes one customer who trips and falls to compromise your business and possibly your personal assets. Workers’ Compensation is required coverage in NJ, and an owner may be liable for a claim that involves someone other than your direct employees.

 

Myth 2. Insurance is not necessary for home-based businesses.

If you’re running a business out of your home, you can still benefit from business insurance. For starters, most homeowners’ insurance policies do not cover home-based business for liability losses and provide very limited property coverage. These policies provide coverage for your home as an owner occupied residence.  Secondly, if you have clients coming to your home, General Liability insurance is vital to cover that exclusion. General Liability protects you from:

●       Slips and falls from customers

●       Being sued for problems with your product or service

●       Damages caused when you are working offsite

 

Myth 3. I don’t need cyber liability insurance because I don’t sell anything over the internet.

If your business is connected to the internet, you are exposed to hackers.  All it takes is one mistake – an employee clicking on a phishing link in an email, for example – and your entire network can be compromised.  If your customers’ personal information is stolen, you can be held responsible for any damages they incur from the cyber criminals, such as identify theft related crimes.  Cyber criminals could gain access your personal information, financial records or even your bank accounts. In many recent cases, the hackers have uploaded a “Ransomware” virus to a network, locking all files and essentially shutting down all computer functions, which cannot be undone unless a ransom is paid to the criminals in bitcoin.

Fortunately, Cyber Liability insurance is available at a reasonable cost to help protect your business in the event of an unwanted intrusion or cyber-attack.

 

Myth 4. Business insurance is too expensive.

Many important things in life come at a cost, and business insurance is no exception. Business insurance for small businesses can be surprisingly affordable, with median business insurance costs at $584 per year. Package policies such as “Business Owner Policies”, provide property, liability and theft coverage all in one package and start as low as $350. To get the best policy for your needs and budget, talk to your insurance agent and discuss the different coverages you need, coverage limits, and the appropriate deductible amount.

 

Myth 5. My business is protected by an entity.

Some business owners think they are adequately protected because they have organized their business as a corporation or an LLC.  You should be congratulated for taking the first steps in protecting your business. However, while the “Corporate Shield” will protect your business in most but not all instances, it is important to further protect what you have built and plan to build with comprehensive business insurance. Don’t let your hard work dissipate due to the lack of appropriate coverage.

Before deciding on a commercial insurance policy, talk to an experienced agent from Danskin Agency.  We provide the appropriate high quality insurance products for local business owners.