How to Get Liability Insurance for the Self Employed

You've decided to break away and start your own business. Good for you. Now it's time to take a look at the expenses you'll entail as a business owner, and one thing you shouldn't cut corners on is liability insurance. Without proper insurance, your business and your family could be vulnerable to significant loss. Here are some tips for finding liability insurance for the self-employed.

Difficulty: Easy

Instructions

1. Sit down with an agent and let them explore your business and areas where you might be most vulnerable to losses.

2. Explore purchasing liability insurance protection for you and your family. This insurance would most likely cover medical and legal expenses if, for example, a client stopped by your home business to look at a blueprint and slipped and fell in your driveway.

3. Look for a policy that will give you coverage for legal costs, 24-hour protection, medical fee coverage and property damage coverage.

4. Realize that the insurer will base the premium on the type of business you own. For contracting or service businesses, the business insurance premium will be based on total payroll.

5. Get several quotes from different insurance agents, and make sure you read through each policy carefully. Ask the agent to explain anything you don't understand. Ask questions that may uncover other areas where you might need coverage.

6. Consider whether you should change your business structure to protect you from potential losses. A limited liability corporation (LLC) or a corporation may make more sense, depending on the type of business you own.

Resources

• The Gaebler website teaches about small business insurance.
• Get tips from the Self-Employed-Insurance-Help website.
• Tomorrow's Money discusses self-employed insurance options.