We could talk all day about all the insurance types available to Minnesota small businesses. Instead, this section will present the most important considerations to lead you down the right path to determining what insurance might be of benefit to you as a small business owner.
What is the purpose for insurance? The entire purpose of insurance is to mitigate risk. Thus, you could consider insurance wherever your business has a risk. Since these areas of risk may not be obvious to you, some of the more popular risks that small business owners want to insurance against are presented here.
Business Owner’s Medical Needs. Most Minnesota small business owners work in their business and don’t have healthcare or medical insurance through another employer. Healthcare/medical insurance or Health Savings Accounts (HSA) are options for Minnesota small business owners.
Business Owner’s Death. Small business owners may want to consider life insurance as a means to cover the debts of the business and ensure their family has the financial resources to survive.
Business Owner’s Disability. Statistically, people are eight times more likely to become disabled than die. For the same reasons that life insurance is important, disability insurance is important: cover the debts of the business and ensure that the business owner’s family has the financial resources to survive
Theft or Destruction of Business Property. The loss or destruction of business property (e.g. machinery, computers, etc.) can be a major inconvenience, or devastating, to a business. Insurance can help mitigate this loss.
Natural Disasters, Catastrophes, and Acts of God. Although Minnesota doesn’t have the risk of hurricanes, Minnesota small businesses may still have the risk of floods, fires, and tornadoes. Depending on your business’s circumstances, this type of insurance coverage may be important.
Harm to Others from Mistakes in Your Business or on Your Business Property. Mistakes can happen in your business. People might be injured while visiting your business. The result of negligence can be an expensive lawsuit that wipes out your business. Liability insurance can help mitigate this risk.
Professional Errors. Depending on your business type, you may want to consider professional liability insurance, errors and omissions insurance, or other insurance that covers negligence, mistakes, and related liability. Similarly, directors and officers liability insurance (“D&O”) protects an organization (usually a corporation) from costs associated with litigation resulting from mistakes incurred by directors and officers for which they are liable.
Everything Else. Umbrella insurance policies can help a small business mitigate a wide variety of risks.
Employee On-the-Job Injuries. Worker’s Compensation is run by the state of Minnesota. For more information, see Minnesota’s Worker’s Comp.
This list of risks, and related insurance policy types of interest to Minnesota small business owners, provides a simple overview to help the small business owner identify areas they may need to evaluate further. However, each small business has its own unique circumstances and factors that present risks. For these reasons, you should discuss your insurance needs with a business attorney or other knowledgeable, objective party. Insurance agents can provide information on specific policies and costs.
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