Charles A. Yuen
August 20, 2012
When starting a New York or New Jersey business
, there are a lot of issues to consider. While many new business owners don’t want to think about what would happen if things go wrong, protecting the business’ assets should be at the top of your list.
Business insurance is one of the ways to address risk. However, it comes in all shapes and sizes, so it may be difficult to determine what type of policies are suitable for your business. Below are several basic types of business insurance:
- General and Auto Liability Insurance: Because it covers the widest array of typical potential liability, all businesses should carry general and auto liability insurance. It protects against losses associated with accidents, injuries, property damage, and claims of negligence, among others.
- Product Liability Insurance: Businesses that manufacture, wholesale, distribute, or retail goods may be liable for injuries due to product defects or other safety concerns. Product liability insurance offers protection from liability that may result from products.
- Commercial Property Insurance: Property insurance can protect against the direct loss and damage of owned or leased property attributable to a number of causes, including fire, wind, flooding, and crime. Policies generally also cover items stored within a building, including merchandise, computers, equipment, and supplies.
- Professional Liability Insurance: Also referred to as errors and omissions insurance, these policies shield professionals against malpractice, errors, and negligence associated with the provision of services to the public. Doctors, lawyers, engineers, accountants, consultants, brokers, and agents will all want to make sure that the appropriate professional cover is in place.
You should review the nature of the business with your agent or broker to assess the adequacy of your limits, including umbrella and excess policy limits, and the possible need for additional types of insurance. Upon policy issuance, you should make sure your agent or broker checks the adequacy of the documentation.
If possible, upon policy issuance you should try to read and become familiar with the policy forms and endorsements and address any questions with your broker or lawyer. Typically, businesses discover significant limitations of their policy only after a claim has been denied. At that point, the insurance carrier is unlikely to provide anything but sympathy.
Of course, whenever a carrier denies coverage, it does not have the last word. You can always fight the denial by negotiating or, if necessary, suing.
If you have any questions about business insurance or would like to discuss this topic, please contact me, Charles Yuen. or the Scarinci Hollenbeck attorney with whom you work.