Running a business in New Jersey can be a rewarding experience, but it also comes with its own set of risks. That’s why it’s important to have the right insurance coverage to protect your business from financial loss in the event of an unexpected event. In this article, we’ll discuss the various types of business insurance available in NJ and how they can benefit your business.
Types of Business Insurance
There are several types of business insurance available in NJ, including:
Type of Insurance |
Description |
|---|---|
General Liability Insurance |
Protects your business from financial loss due to third-party claims for bodily injury, property damage, or advertising injury. |
Property Insurance |
Covers damage to your business property, such as your building, equipment, and inventory. |
Business Interruption Insurance |
Provides coverage for lost income and expenses if your business is unable to operate due to a covered event, such as a fire or natural disaster. |
Workers’ Compensation Insurance |
Provides coverage for medical expenses and lost wages if your employees are injured or become ill on the job. |
Professional Liability Insurance |
Protects your business from financial loss due to claims of negligence or errors and omissions by your professional services. |
It’s important to assess your business needs and risks to determine which types of insurance you need to protect your business.
General Liability Insurance
General liability insurance is one of the most common types of business insurance, and for good reason. It provides coverage for a variety of claims that can arise from your business operations, such as:
- Bodily injury
- Property damage
- Advertising injury (e.g. libel, slander, copyright infringement)
General liability insurance can also provide coverage for legal defense costs, which can be expensive even if a claim is unfounded. It’s important to have adequate coverage to protect your business from financial loss.
Do I Need General Liability Insurance?
If your business interacts with customers or the public in any way, it’s highly recommended to have general liability insurance. Claims can arise from something as simple as a customer slipping and falling in your store or an employee damaging a customer’s property during a service call.
Even if you operate your business from your home, general liability insurance can provide coverage for claims that occur off-premises, such as at a client’s home or office.
How Much Coverage Do I Need?
The amount of coverage you need depends on several factors, such as the size of your business, the industry you’re in, and the types of risks you face. It’s a good idea to work with an experienced insurance agent who can help you assess your needs and provide guidance on the appropriate coverage limits.
Some industries may require higher coverage limits due to the level of risk involved. For example, construction companies may need higher limits due to the potential for bodily injury and property damage claims.
What Does General Liability Insurance Not Cover?
General liability insurance typically does not cover:
- Employee injuries (covered by workers’ compensation)
- Professional services (covered by professional liability insurance)
- Intentional acts or criminal activity
- Employee discrimination or harassment
It’s important to review your policy carefully to understand what is and isn’t covered.
How Much Does General Liability Insurance Cost?
The cost of general liability insurance varies depending on several factors, such as the size of your business, the industry you’re in, and the coverage limits you choose. On average, small businesses in NJ can expect to pay between $400 and $1,500 per year for general liability insurance.
It’s important to shop around and compare quotes from multiple insurance providers to ensure you’re getting the best coverage at the best price.
Property Insurance
Property insurance provides coverage for damage to your business property, such as your building, equipment, and inventory. It can also provide coverage for business interruption expenses if your business is unable to operate due to a covered event.
Do I Need Property Insurance?
If you own or lease a physical location for your business, property insurance is highly recommended. Without property insurance, you could be responsible for expensive repairs or replacement costs if your property is damaged or destroyed by a covered event, such as a fire or natural disaster.
How Much Coverage Do I Need?
The amount of coverage you need depends on the value of your business property. It’s a good idea to conduct a thorough inventory of your property and work with an experienced insurance agent to determine the appropriate coverage limits.
What Does Property Insurance Not Cover?
Property insurance typically does not cover:
- Flood damage (covered by separate flood insurance)
- Earthquake damage (covered by separate earthquake insurance)
- Equipment breakdown
It’s important to review your policy carefully to understand what is and isn’t covered.
How Much Does Property Insurance Cost?
The cost of property insurance varies depending on several factors, such as the size of your business, the industry you’re in, and the coverage limits you choose. On average, small businesses in NJ can expect to pay between $500 and $3,000 per year for property insurance.
Again, it’s important to shop around and compare quotes from multiple insurance providers to ensure you’re getting the best coverage at the best price.
Business Interruption Insurance
Business interruption insurance provides coverage for lost income and expenses if your business is unable to operate due to a covered event, such as a fire or natural disaster. It can also provide coverage for expenses related to relocating your business temporarily.
Do I Need Business Interruption Insurance?
If your business relies on a physical location to operate, business interruption insurance is highly recommended. Without it, you could be responsible for lost income and expenses if your business is unable to operate due to a covered event.
How Much Coverage Do I Need?
The amount of coverage you need depends on several factors, such as the size of your business and the amount of income you generate. It’s a good idea to work with an experienced insurance agent to determine the appropriate coverage limits.
What Does Business Interruption Insurance Not Cover?
Business interruption insurance typically does not cover:
- Closures due to voluntary shutdowns
- Disruptions due to planned maintenance or repairs
- Losses due to market conditions or economic downturns
It’s important to review your policy carefully to understand what is and isn’t covered.
How Much Does Business Interruption Insurance Cost?
The cost of business interruption insurance varies depending on several factors, such as the size of your business, the industry you’re in, and the coverage limits you choose. On average, small businesses in NJ can expect to pay between $500 and $2,000 per year for business interruption insurance.
Again, it’s important to shop around and compare quotes from multiple insurance providers to ensure you’re getting the best coverage at the best price.
Workers’ Compensation Insurance
Workers’ compensation insurance provides coverage for medical expenses and lost wages if your employees are injured or become ill on the job. It also provides coverage for legal defense costs if an employee files a lawsuit against your business for a work-related injury or illness.
Do I Need Workers’ Compensation Insurance?
If you have employees in NJ, it is required by law to have workers’ compensation insurance. Even if your employees work part-time or seasonally, you still need to provide coverage.
How Much Coverage Do I Need?
The amount of coverage you need depends on several factors, such as the number of employees you have and the industry you’re in. It’s important to work with an experienced insurance agent to determine the appropriate coverage limits.
What Does Workers’ Compensation Insurance Not Cover?
Workers’ compensation insurance typically does not cover:
- Employee injuries that occur off the job
- Injuries caused by employee misconduct or drug/alcohol use
- Injuries that occur while an employee is commuting to or from work
It’s important to review your policy carefully to understand what is and isn’t covered.
How Much Does Workers’ Compensation Insurance Cost?
The cost of workers’ compensation insurance varies depending on several factors, such as the number of employees you have and the industry you’re in. On average, small businesses in NJ can expect to pay between $2 and $5 per $100 of payroll for workers’ compensation insurance.
Again, it’s important to shop around and compare quotes from multiple insurance providers to ensure you’re getting the best coverage at the best price.
Professional Liability Insurance
Professional liability insurance provides coverage for claims of negligence or errors and omissions by your professional services. It can provide coverage for legal defense costs, as well as damages awarded to the claimant.
Do I Need Professional Liability Insurance?
If your business provides professional services, such as consulting or legal advice, professional liability insurance is highly recommended. Claims can arise from something as simple as a missed deadline or an overlooked detail, which can result in expensive legal fees and damages.
How Much Coverage Do I Need?
The amount of coverage you need depends on several factors, such as the size of your business and the industry you’re in. It’s important to work with an experienced insurance agent to determine the appropriate coverage limits.
What Does Professional Liability Insurance Not Cover?
Professional liability insurance typically does not cover:
- Intentional or criminal acts
- Non-professional services, such as general contracting
It’s important to review your policy carefully to understand what is and isn’t covered.
How Much Does Professional Liability Insurance Cost?
The cost of professional liability insurance varies depending on several factors, such as the size of your business and the industry you’re in. On average, small businesses in NJ can expect to pay between $500 and $2,000 per year for professional liability insurance.
Again, it’s important to shop around and compare quotes from multiple insurance providers to ensure you’re getting the best coverage at the best price.
Conclusion
As a business owner in NJ, it’s important to have the right insurance coverage to protect your business from financial loss in the event of an unexpected event. By working with an experienced insurance agent and assessing your needs and risks, you can determine the appropriate coverage to protect your business and give you peace of mind.