Connecticut is home to over 350,o00 small businesses that employ 745,000 people. The outlook for small businesses in Connecticut is great! But are you doing everything you can to protect your business? One of the best things you can do is protect your business is by investing in Connecticut small business insurance.
What does that look like? Is there a type of insurance that's required? In this article, we answer the burning questions you may have about coverage. We'll talk about what insurance is required by the state of Connecticut and give you a general overview of optional business insurance policies you might want to consider.
What Insurance is Required in Connecticut?
The state of Connecticut only requires businesses with employees to purchase workers' compensation insurance.
You Must Carry Workers' Compensation Insurance
The Connecticut Insurance Department only requires that all businesses with one or more employees—full-time, part-time, or seasonal—carry workers' compensation insurance. The only exception is household employees working less than 26 hours per week.
How does workers' compensation work? If one of your employees gets hurt at work or becomes ill from something they're exposed to, workers' compensation kicks in. Workers' comp insurance will cover the injured employee's medical costs and lost wages until they're able to return to work.
You can get workers' compensation coverage through a private insurance company.
Optional Types of Small Business Insurance in Connecticut
We recommend small businesses in Connecticut look into these optional—but important—business insurance coverages.
Professional Liability Insurance
Professional liability insurance—also referenced as errors and omissions insurance—protects your business if you're accused of negligence, missed deadlines, professional errors, incomplete work, or libel and slander (similar to a general liability policy).
Professional liability insurance will pay defense costs for legal claims, court costs, and other legal expenses that come up. A professional liability policy is usually recommended for healthcare professionals, lawyers, architects—basically anyone that offers professional services.
General Liability Insurance
General liability insurance, sometimes referred to as CT business liability insurance, isn't required in but comes highly recommended for all Connecticut businesses. Commercial general liability insurance is both comprehensive and affordable. General liability insurance usually covers:
- Third-party bodily injuries: This part of your general liability plan includes coverage for a customer's medical expenses if they're injured in your business.
- Third-party property damage: If someone's personal property gets damaged while on your property because of negligence or a mistake on your part, your insurance company will cover the cost to repair the damage or replace the item.
- Personal and advertising injury: This part of your business liability insurance will protect your business if you're accused of libel, slander, or copyright infringement. Your insurance will provide you with a legal defense and cover legal costs if you're sued by a disgruntled customer.
Consider commercial umbrella insurance
Sometimes, it can be more affordable to purchase an umbrella policy instead of upping the limits on an underlying policy. Some umbrella policies will also cover perils excluded from underlying policies. If you need better coverage at an affordable price, check with an insurance agency to compare costs.
Commercial Property Insurance
Commercial property insurance (sometimes referred to as business property insurance) is recommended for anyone with a physical location. It's also commonly required by lenders or leaseholders. Property insurance protects your building from covered perils like theft, vandalism, fire, and storms. It also protects your furniture, inventory, equipment, and business personal property.
Commercial Flood Insurance
Unfortunately, most insurance carriers exclude any damage caused by flooding. If your business is located in a flood zone you may want to consider a separate insurance policy. If you don't, and you experience flooding, any costs to repair damage or replace inventory falls squarely on your shoulders.
Home-Based Business Insurance
If you run a business from a home office, your homeowner's insurance or renter's insurance may not cover much of your business equipment and inventory. Even if your policy does provide some coverage for business-related losses, most insurers will cap the coverage at a low dollar amount.
So what do you do? We recommend you check with your insurance agent to see what your coverage is. If it isn't enough to protect your home-based business, have a chat with them about home-based business insurance options.
Connecticut Business Owners’ Policy
A business owners' policy (BOP) is a combination of different insurance options that insurers will offer small businesses. A business owners' policy is often more affordable than purchasing each insurance separately. The usual BOP includes property insurance, general liability insurance, and business interruption insurance.
Some insurance companies may include specialized options in a business owner's policy that would cover the risks that are unique to your industry. That's why it's best to work with an experienced insurance agent with knowledge in your industry. They can help you get customized small business insurance.
Business Interruption Insurance
Business interruption insurance helps cover operating costs if your physical property is damaged by something covered in your property insurance policy. If you can't operate your business until the damage is repaired, this policy helps protect you from financial losses. The policy can help pay your lease, cover employee payroll, and can also reimburse a portion of your lost income.
Commercial Auto Insurance
If you use personal autos for business purposes or you own vehicles solely for business use, you need Commercial auto insurance. Why? Accidents that occur while you're working are often excluded from coverage in a personal auto policy.
Rest assured that commercial auto is just as comprehensive as your personal auto policy. Thes policies can include coverage for third-party bodily injuries, property damage, personal injury protection, comprehensive and collision coverage, and uninsured and underinsured motorist coverage.
You must carry a minimum of $50,000 of bodily liability coverage, $25,000 in coverage for physical damage coverage, and $50,000 in uninsured and underinsured motorist coverage
Cyber Liability Insurance
Cyber liability insurance protects your business from monetary losses if you're hacked or the subject of a cyberattack. If any customer data is compromised, your insurer will cover the cost to notify any impacted customers. Most policies will also pay for credit monitoring for those impacted. Some will help cover the cost to repair your reputation if it's deemed necessary.
How Much Does Connecticut Business Insurance Cost?
The cost of general liability insurance coverage for a small business in Connecticut can start as low as $29 a month. But you'll likely pay slightly higher insurance premiums. Why? Certain factors impact premium costs:
- The industry your business is in
- Where your business is located
- The length of time you've been in business
- Your annual gross sales
- Whether or not you have an extensive claims history
- The deductibles and policy limits you choose
- How much coverage your business needs ($500,000, $1 million, etc.)
- The number of employees you hire
- The insurance company that you get coverage through
These are just a few of the things an insurance agent will consider when assessing your business insurance needs.
Small Business Owners: Get a Free Quote
We understand how difficult it can be to find the best commercial insurance for your Connecticut business. Whether you are a roofer in Hartford, an excavation contractor in Stanford, or a house cleaner in New Haven, we can help you find the perfect coverage for your specific needs.
Our goal at Tivly is to help you get the right business insurance policy at an affordable price. The process is fast and easy! Complete the form at the top of the page and someone will reach out to you. Or, give us a call at 877-907-5267.
Connecticut Small Businesses Commonly Insured
Some professions that are commonly insured in Connecticut include:
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