Sole Proprietorship Insurance

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A sole proprietorship isn’t technically a separate business entity like an LLC or an S-Corp, which means that business liabilities can easily become personal liabilities. It’s essential to have the right coverage to protect both your business and your personal assets. Mishaps on the job or accidental injuries from something as simple as a client or customer falling can put not just your business at risk, but also your personal assets like your savings, your house, and more. Fortunately, CoverWallet makes it easy to get the coverage you’ll need to protect your business and your personal assets.

Commercial General Liability Insurance for Sole Proprietors

Your Commercial General Liability Insurance (CGL) is the foundation for a well-planned insurance coverage strategy. You can purchase a CGL policy as a standalone policy or as part of a policy with broader coverage. If you have homeowner’s insurance, the liability coverage on that insurance policy doesn’t cover business-related risks, which can leave you exposed to potentially large lawsuits. CGL coverage, as a standalone policy or as part of an insurance package, protects your business against bodily injury claims and claims due to accidental damage to the property of others. Coverage also includes claims for personal injury (libel and slander) as well as advertising injury.

Because a sole proprietorship isn’t a separate legal entity, liabilities incurred by the business can easily become liabilities for which you may be responsible for as the business owner/sole proprietor. Coverage limits usually start at $1 million per occurrence with a $2 million aggregate limit, which are also the minimum coverage limits often required by commercial landlords if you’re renting a small space.

Essential Insurance Coverages for Sole Proprietorship

As a sole proprietor, there are several other types of coverage you should consider.

Commercial Auto Insurance is required for any vehicles (including cars) that are primarily used for business purposes. In most cases, your personal auto insurance won’t cover business-related use of your vehicle. Bodily injury liability due to auto accidents can result in claims totaling tens of thousands of dollars — or possibly more. A well-structured Commercial Auto Insurance policy can cover this risk as well as provide physical damage protection for your vehicle.

If you have employees, it’s likely that your state also requires Workers’ Compensation coverage. One of the benefits of Workers’ Comp is that it also protects your business against many types of lawsuits related to work injuries, making your coverage essential protection for both you and your workers.

Professional liability insurance is another common coverage that protects you as a sole proprietor against mistakes that create financial losses for others. Professional liability Insurance, also called Errors and Omissions Insurance, helps ensure that the mistakes that can happen to anyone don’t cost you your savings.

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Commercial Package Policy for Sole Proprietors

As a sole proprietor, you may think that insurance is the last thing you need. After all, you are accountable for only you and will be able to rectify any mistakes right? What happens when something happens that has nothing to do with you personally but still has to do with your business and you are liable? These things can happen so easily that we don’t even think about it. For example, a third party, whether your customer or a mail delivery person, walks on your job site and trips and falls. If the trip can be traced back to your business at all, you could be sued. Additionally, your state may have sole proprietorship requirements that will prevent you from even having a choice on whether or not to obtain insurance. Protect yourself by purchasing a Commercial Package insurance policy.

No business is exactly the same as the next but businesses in certain industries often have similar needs when it comes to insurance coverage. A Commercial Package Policy provides a cost-effective way to bundle the coverages you need into one policy, which makes it easy to manage and saves money. By choosing a package policy, you’re choosing only the coverages that are relevant to your business — without the extras — but you can still adjust your coverages and coverage limits as your sole proprietorship grows.

Business Insurance

Running a business is challenging enough without having to worry about lawsuits, employee injuries or property damage. Having the right insurance gives you the peace of mind to focus on what matters - running your business.

The coverage you need depends on the type of business you run. A restaurant owner needs to be covered against customers possibly getting food poisoning while an accountant needs to be covered against calculation errors. CoverWallet's intelligent assessment system will identify the insurance you need based on your specific business, get you a policy that fits your budget, and do it all in less time than you think.

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