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Did you know Utah is known as "The Beehive State"? With over 200,000 small businesses, it's no wonder the state is abuzz with small business owners.
Having business insurance coverage could potentially benefit those businesses, including your own. In this article we'll tell you why, and also give you info on the types of insurance you can get, how different policies may benefit you, which ones are required, and how to get them.
Before we talk about why you may want to get Utah general liability insurance, let's define what it is.
This type of coverage helps to cover costs if you're sued for:
Trying to wrap your head around any of the above being possibilities? After all — you're just getting started.
We know it's hard to imagine, but each year, 43% of small businesses surveyed reported getting involved in or threatened with a civil lawsuit. If you happen to be part of that statistic, you'll be glad that you took the opportunity to protect yourself.
Need some examples to see how general liability insurance in Utah may be able to help your small business? Here are some instances where it could come in handy:
Several days later, the client calls the plumber to tell them that the basement has flooded. They installed a bathroom in their basement and it flooded, damaging the newly furnished downstairs living room. The customer sues the plumber for the cost of fixing the pipes and replacing the damaged furniture and carpet.
The client may not be justified in suing, but that's why it's called a claim. Without general liability insurance, the plumber may have to pay for the customer’s replacement and damage requests out-of-pocket, meaning a big blow to his business's bank account. But general liability coverage could potentially help to cover the cost of the replacement work, as well as any associated legal costs.
The customer is furious and sues the business owner for the cost to repair their car. Without general liability insurance in Utah, the tree removal specialist could be responsible for covering the repair costs out-of-pocket.
With a general liability policy, though, the cost of the car repairs could be covered, as well as the cost of potential legal representation.
The customer is OK but had to spend a night in the hospital, and they're suing the repair business owner for the cost of the medical bills, as well as a new range and microwave oven to ensure this doesn't happen again.
General liability insurance coverage could help to cover the customer's medical bills, as well as the cost of new appliances plus installation. Without a policy, there's a chance the repair person may have to use their own money to reimburse the customer, which could dig their business a hole they may not be able to get out of.
All of these situations could potentially end one of two possible ways: With insurance, the business owners could be put at ease knowing their businesses are protected and they can move forward. Without coverage, these businesses could risk impacting or losing what they've worked so hard for.
By the way, if you're a licensed contractor in Utah, the end of that scenario isn't up for debate: you're required to have general liability insurance.
What about the instances where there are other risks? In the next section, we'll talk about another type of insurance coverage that can help protect business owners.
Professional liability insurance is coverage that can help protect small businesses against claims of negligence.
There are many small business owners who may want to consider professional liability insurance in Utah. Some of the professions that could typically benefit are:
Similar to general liability insurance, you may be having a difficult time imagining how this type of coverage comes into play.
Let's look at a few situations where professional liability insurance in Utah could potentially benefit business owners.
The parents sue the education consultant, claiming that it's their fault their child was rejected. In this case, professional liability coverage could help to cover the cost of legal representation and other associated costs with the claim.
Without the coverage, the education consultant may have to pay legal fees and other associated costs, which would come out of the consultant's pocket, putting the business in debt and its future at risk.
Weeks later, the client decides to sue the web designer because the new website homepage and landing pages aren’t generating the revenue they’ve expected. They're suing for the cost of the web designer's work, as well as the cost of the projected losses since they were hired.
Without professional liability insurance, the web designer could potentially be required to pay a hefty sum to the client, which not only puts their business in debt but also could cut into the funds they needed to pay rent on their office space. Things could go downhill fast!
If the web designer had a professional liability policy, though, it could cover the cost of the website design, as well as the projected losses, in addition to legal fees if a claim is filed.
Months later, the client sues the life coach because after the coaching, they decided to quit their job. The new career path they’ve chosen isn't as lucrative as expected, and they’re running behind on their bills. The client sues the life coach for the cost of the program.
In this case, the life coach may have to cover the costs of the program reimbursement out-of-pocket, which could potentially impact the books. Professional liability insurance could be able to help cover the cost of hiring a lawyer to defend the claim, as well as the cost of the program reimbursement.
In all of these scenarios, the business owners could be left with the ruins of the business they worked so hard for.
If you're a small business owner who operates with any employees, you'll be required by the state to have Utah workers compensation insurance.
This type of coverage helps protect you, your business, and your employees if they get sick or hurt while working for you.
There are a couple exceptions to this (some agricultural workers may be exempt, for example), but most employers need workers compensation coverage. We'll go into how this policy could help protect you after we discuss some other Utah insurance coverages you may want to look into.
We've covered general and professional liability and workers compensation coverage, but what other types of coverage may you also want to consider?
Don't worry--we're about to tell you:
Home-based business insurance.
If you run your business out of your home, then you may want to consider a home-based business policy.
Even if you have a traditional homeowner's policy, that coverage may not cover every situation.
If you work out of a home office, you likely have equipment and materials and may even have clients visiting. What happens if your equipment is damaged or a client gets hurt during an appointment?
Having home-based business insurance can help protect you from paying costly claims out-of-pocket.
That's because despite having a homeowner's policy, that coverage may not be comprehensive enough to include your home office/business equipment and materials.
Speaking of holes in homeowners' policies, did you know they often don't include flood insurance?
Sure, Utah is in the desert, but what if your business experiences flooding? Whether your business is in your home or in a retail location, flood insurance coverage could save you from spending money on damages and repairs if you find yourself in that type of situation.
You can check out the National Flood Insurance Program here.
Commercial auto insurance.
If you drive a vehicle to do your job, you'll likely need Utah commercial auto insurance. If you drive your personal vehicle for work, it's likely that your personal auto insurance policy does not cover commercial auto claims.
If you're working and involved in an accident, then this type of policy could help cover the cost of repairs to damages or replacements.
Business income insurance.
This type of coverage can help to protect you financially if you have to shut down your business due to theft or a storm, for example.
According to the Utah Labor Commission, if you have employees, then you need to carry workers compensation insurance. There are few exceptions, but if you feel you may fall into an exempt category, such as an agricultural worker, for example, then contact the Labor Commission to learn more and confirm.
If you have any employees — whether full-time, part-time, full-time, or seasonal — and they become sick or injured while working for you, you'll want to make sure both they and your business are protected by this coverage.
A workers compensation policy can protect your employee and your business by helping to cover costs of medical treatment, indemnity (meaning if they miss days of work, for example), and in the unfortunate circumstance, death.
If an employee is sick or injured, then this coverage also can help to protect the employee and help the business in their return-to-work transition.
Every small business has different needs, which is why we can't give you a one-size-fits-all price for Utah business insurance. After all, a plumber and an accountant don't usually face the exact same risks!
A variety of factors can impact the cost of your business insurance coverage, including the size of your company, location, how long you've been in business, and the specific occupation you practice.
Similar to making any large purchase, a great way to see what your policy premiums may look like is to compare quote options. At Simply Business, we have a free quote comparison tool you can use to see what different top carriers in the nation may charge you for a policy premium.
As an example, you'll see that with Simply Business, general liability insurance quotes start at $22.50/month.
To see what coverage may cost you, you can get your quotes here or talk live to a Simply Business licensed insurance agent at 855- 559-0338.
Now that you have an understanding of the type of insurance cover you may want to consider for your small business, how do you go about getting a policy?
Here are some things you can do to make sure you choose the right business insurance policy — and workers compensation policy, for you:
Talk to other business owners.
As a small business owner, community counts for a lot, so don't take it for granted. If you know other small business owners, don't be shy about asking them what type of coverage they have and how it protects them to compare potential options to consider.
Know your risks.
It's your responsibility to do your research before selecting a business insurance policy. Get an understanding of the kinds of risks your business faces and what type of coverages you may be legally required to have.
This article is a great starting point, but it should be just one of your resources along the way.
Talk about it!
Once you have your business insurance coverage, show proof of your policy by displaying your Certificate of Insurance (COI) in your storefront or on your business's website. And remember to share what you're learning with other small business owners.
Just like others have shared their knowledge with you, you can strengthen your community by sharing what you've learned throughout this process.
We mentioned earlier that Utah is abuzz with activity from small business owners — and after reading all of this, your mind may be abuzz, too!
Give yourself some time to let everything sink in. Part of being a responsible business owner is taking your time so that you can be confident you're making the right decision for you. Once you're ready, you can compare quotes and choose a policy.
By the way, did you know that choosing business insurance coverage isn't the only topic we cover? For more information about starting or growing your business, head to our blog, Simply U.
No matter where you are in your journey of being a business owner, the decision to consider business insurance is a wise one, so know that your instincts are spot on!
*Monthly payment calculations (i) do not include initial premium down payment and (ii) may vary by state, insurance provider, and nature of your business. Averages based on January - December 2020 data of 10% of our total policies sold.
This content is intended to be used for informational purposes only. It is not intended to provide legal, tax, accounting, investment, or any other form of professional advice.
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*Harborway Insurance policies are underwritten by Spinnaker Insurance Company and reinsured by Munich Re, an A+ (Superior) rated insurance carrier by AM Best. Harborway Insurance is a brand name of Harborway Insurance Agency, LLC, a licensed insurance producer in all 50 states and the District of Columbia. California license #6004217.