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For many limited liability companies (LLCs), LLC insurance is an essential part of running a successful business. Small business insurance for LLCs helps protect your company from claims that can come up during normal operations. Without it, you’d have to pay out of pocket to cover these claims, which can be very expensive.What Is LLC Insurance?
LLC insurance helps protect businesses from different liability claims, like bodily injury or property damage caused by your:
- Business
- Employees
- Products
Many small businesses register as LLCs. This separates your business assets from your personal belongings. However, it doesn’t protect your business from the various risks it may face. Depending on the industry your business is in, LLC insurance may be necessary.
Do I Need Business Insurance for My LLC?
It’s a good idea to have business insurance for your LLC. Without insurance coverage, you’d have to pay out of pocket to cover claim costs, which may not be feasible for many small businesses. The insurance needed for small business depends on the type of small business you run and the risks it faces.Be aware that LLCs may be required to have certain types of business insurance. For example, most states require businesses with employees to have workers’ compensation insurance.
If your small business provides professional services to customers or clients, you can be at risk of a liability claim. Certain types of LLC insurance, like professional liability insurance, can help:
- Protect your business’ property and possessions
- Lessen the risk to your personal assets
- Cover legal costs if a customer or competitor sues you
What Does LLC Insurance Cover?
LLC insurance from The Hartford provides liability coverage to help protect your business from financial losses. You may want to consider two important types of coverage: professional liability and general liability insurance.
Professional Liability Insurance for LLCs
As a small business owner, you try your hardest to keep your customers happy, but mistakes can happen. Our professional liability insurance helps protect you and your LLC if a customer sues you for making a mistake in the professional services given. This insurance is also known as errors and omissions coverage or E&O coverage.
Let’s say you own an accounting firm and one of your accountants makes a clerical error. The mistake causes your client to pay thousands of dollars in fees, so they sue your business. Professional liability insurance can help cover your legal costs related to their claim.
General Liability Insurance for LLCs
General liability insurance, also known as business liability insurance, can help protect you from claims that your LLC caused bodily injuries or damaged someone else’s property. Liability claims related to work done away from your business location may also be covered under products-completed operations coverage.
So, if a customer trips over a loose wire at your business and breaks their wrist, general liability insurance can help cover their medical expenses. Without it, you or your business would have to pay out of pocket for their medical bills.
This insurance can also help cover claims of personal injury. So, if you say something that can damage another person’s reputation, they can sue your business for libel or slander.
General liability insurance isn’t typically required by law. However, it’s still good to have because it helps protect your business. These kind of liability claims can happen during everyday operations, so it’s essential that you have general liability insurance coverage to help protect your business.
Additional Coverages To Consider With LLC Business Insurance
When it comes to insurance for small business, LLCs may also choose to get more coverage to protect against other liabilities. This can include:
- Workers’ compensation insurance: Most states require businesses with employees to carry workers’ compensation. It gives your employees benefits to help them recover from a work-related injury or illness.
- Commercial auto insurance: This helps cover property damage or medical expenses if you or an employee gets into a car accident while driving a company-owned vehicle for work.
- Business income insurance: If your business can’t open because of covered property damage, this insurance can help cover your lost income.
- Commercial property insurance: This coverage helps protect your LLC’s owned or rented physical location and the tools and inventory you use to operate. Commercial property insurance also provides business renters insurance for rentals.
How Much Does LLC Insurance Cost?
LLC insurance costs vary. That’s because every small business is different and has unique needs. Insurance companies look at different factors to determine a business’ LLC insurance cost. This can include your:
- Claims history
- Number of employees
- Revenue
- Location
The best way to find out how much LLC insurance costs your business is to get a quote.
Get LLC Insurance From The Hartford
We’re an experienced insurance company with more than 200 years of experience. We know every small business is unique. Our specialists can work with you to get the right type of liability coverages and make sure you’re complying with state laws. Get a quote today and see how LLC insurance from The Hartford can help protect your business.