What Insurance Do I Need to Start a Business?

Starting a business is exciting, but it also comes with risk. Whether you are opening a storefront, starting a service-based business, launching a side business, or hiring your first employee, insurance is an important part of protecting what you are building.

Many new business owners know they need “business insurance,” but they are not always sure what that actually means. The truth is, there is not one single policy that fits every business. The coverage you need depends on what you do, where you operate, whether you have employees, what property you own, and what risks your business faces.

Here are a few common types of insurance Oklahoma business owners may want to review before getting started.

General Liability Insurance

General liability insurance is one of the most common types of business insurance. It may help protect your business if someone claims your business caused bodily injury, property damage, or certain types of personal injury.

For example, general liability may apply if a customer slips and falls at your business, if you damage someone else’s property while working, or if your business is accused of causing harm through advertising or other covered situations.

Even if general liability is not legally required for every business, many landlords, vendors, and clients may require proof of coverage before they will work with you.

Commercial Property Insurance

If your business owns equipment, inventory, furniture, tools, computers, or a physical location, commercial property insurance is worth reviewing.

This coverage may help protect business property from covered losses such as fire, theft, vandalism, or certain storm-related damage. The exact coverage depends on your policy.

Even if you run your business from home, your homeowners insurance may not fully cover business equipment or business-related losses. That is why home-based business owners should still talk with an insurance agent.

Business Owner’s Policy

A business owner’s policy, often called a BOP, combines several common coverages into one policy. It usually includes general liability and commercial property coverage, and it may be a good fit for certain small businesses.

A BOP can be helpful for businesses such as offices, boutiques, salons, small retail shops, and other qualifying businesses. However, not every business is eligible, and some industries may need more specialized coverage.

Workers’ Compensation Insurance

If you have employees, workers’ compensation insurance is an important coverage to understand. Workers’ comp may help provide benefits if an employee is injured or becomes ill because of their job.

In Oklahoma, most businesses with employees are required to carry workers’ compensation insurance. Because rules can depend on your business structure and situation, it is important to review your requirements before hiring employees.

Commercial Auto Insurance

If your business owns vehicles or uses vehicles for work, you may need commercial auto insurance.

Personal auto insurance may not cover certain business use. For example, if you use a vehicle to make deliveries, haul tools, visit job sites, transport clients, or conduct regular business operations, you should review whether commercial auto coverage is needed.

This is especially important for contractors, delivery businesses, service companies, real estate professionals, and businesses with employees driving for work.

Professional Liability Insurance

Professional liability insurance, sometimes called errors and omissions coverage, may help protect businesses that provide professional advice or services.

This coverage may apply if a client claims your business made a mistake, gave incorrect advice, missed an important deadline, or failed to deliver professional services as expected.

Businesses such as consultants, accountants, marketing professionals, real estate professionals, designers, and other service providers may want to review this type of coverage.

Cyber Liability Insurance

Many small businesses rely on technology, even if they do not think of themselves as “tech businesses.” If you collect customer information, take online payments, use email, store client records, or operate a website, cyber liability coverage may be worth considering.

Cyber coverage may help with certain costs related to data breaches, cyberattacks, fraud, or other digital risks, depending on the policy.

Small businesses are not too small to be targeted, which makes this coverage more important than many new business owners realize.

Industry-Specific Coverage

Some businesses need special coverage based on what they do.

A restaurant may need liquor liability, food spoilage coverage, or equipment breakdown coverage. A contractor may need tools and equipment coverage, a certificate of insurance, or specific coverage required by a job contract. A salon may need coverage for professional services, products, and business property. A landlord or commercial property owner may need coverage for rental property exposures.

This is why it is important to avoid guessing. The right insurance plan should be built around your actual business, not just a generic checklist.

Review Contracts, Leases, and Licensing Requirements

Before you open your doors or sign an agreement, review any insurance requirements in your contracts, leases, or licensing paperwork.

A landlord may require general liability coverage before you move into a commercial space. A client may require a certificate of insurance before you begin work. A vendor, lender, or licensing board may also have specific coverage requirements.

If you are not sure what the insurance section of a contract means, send it to your insurance agent before signing.

So, What Insurance Do You Actually Need?

The answer depends on your business.

A home-based consultant will not need the same coverage as a restaurant. A contractor will not need the same policy as a retail shop. A business with employees will have different concerns than a solo business owner.

Before starting your business, it is helpful to ask:
What services or products do I provide?

•  Do customers come to my location?
•  Do I work on other people’s property?
•  Do I own tools, inventory, or equipment?
•  Do I have employees?
•  Do I use a vehicle for business?
•  Do I store customer information?
•  Do my contracts require specific insurance?

The answers to these questions can help determine what coverage makes sense.

Need Help With Business Insurance in Oklahoma?

At Foundation Insurance & Risk Management, we help Oklahoma business owners understand their insurance options before problems happen. Whether you are starting a new business, signing a lease, hiring employees, or reviewing contract requirements, our team can help you find coverage that fits your situation.

If you are starting a business in Guthrie, Edmond, Oklahoma City, Norman, or anywhere in Oklahoma, contact Foundation Insurance & Risk Management. We would be happy to help you review your options and protect what you are building.