Commercial Insurance and Bonds

Your business faces many risks and exposures amid daily operations and regular tasks. Regardless of how diligent you may be in minimizing risks or how experienced your employees are, accidents or mistakes may be inevitable. With that in mind, it’s essential to implement sufficient risk management practices to help protect your clients’ interests and your organization’s reputation.

What Does Commercial Insurance Cover?

Commercial insurance, or business insurance, often refers to more than just a single policy. Although some insurance companies may offer certain prearranged packages suitable for some businesses, your commercial insurance may need to be assembled from a collection of policies. For most businesses, an adequate portfolio may include the following:

• General liability insurance—This coverage can help pay for third-party losses for which your business is responsible, such as those arising from the following incidents:
  • Bodily injury
  • Property damage
  • Personal and advertising injury (e.g., slander, libel, copyright infringement, false advertising)
• Commercial property insurance—By maintaining this coverage, also known as business property insurance, you may have access to financial assistance for losses involving physical property used to operate your business, including the following:
  • Buildings
  • Electronics
  • Equipment
  • Inventory
  • Furniture
• Business interruption insurance—If your business is forced to pause or alter its normal operations due to a covered incident, this coverage, also known as business income insurance, can help pay for the following losses or expenses:
  • Lost income
  • Employee payroll
  • Rent/mortgage payments
  • Tax/loan payments
• Workers’ compensation insurance—In the aftermath of a work-related injury or illness, this coverage, which is legally required for most employers, can provide financial assistance for the following:
  • Medical expenses
  • Lost or reduced wages
  • Disability benefits
  • Death benefits
  • Employer legal costs
• Employment practices liability insurance—This coverage, often referred to as EPLI, can provide financial aid in response to lawsuits accusing your organization of improper workplace practices, such as the following:
  • Discrimination
  • Sexual harassment
  • Wrongful termination
  • Improper hiring practices

While the aforementioned coverages may apply to most employers, your organization should evaluate your operations and circumstances to determine if additional coverages are necessary. For example, you should acquire commercial auto insurance if your business has vehicles. Similarly, if you provide professional services or guidance or manage sensitive data, you should prioritize professional liability insurance and cyber liability insurance, respectively.

How Much Does Commercial Insurance Cost?

The cost of a sufficient commercial insurance portfolio may vary significantly. Insurance companies must thoroughly analyze your organization before providing an accurate quote for suitable coverage. In general, this may include consideration of the following:

• Industry
• Location
• Workforce size
• Assets and revenue
• Prior claims history
• Portfolio details (e.g., coverages acquired, policy limits, deductibles)

What Is a Surety Bond?

Surety bonds may be valuable to your organization’s risk management measures. They are binding agreements that can provide financial assurances to clients or other parties that you will adhere to your duties in accordance with the bond (e.g., complete your work as described or comply with applicable regulations).

Surety bonds generally include the following three parties:

• The principal—This party, such as a business or contractor, purchases surety bonds if required by the obligee.
• The obligee—This party, such as a land owner, developer or government entity, determines if surety bonds are necessary.
• The surety—This party, such as an insurer, underwrites and maintains surety bonds.

Surety bonds pay out to the obligee if the principal fails to fulfill their agreed-on obligations. The surety can then pursue reimbursement from the principal.

Fidelity Bonds

Fidelity bonds are another way to protect your organization financially. These arrangements, also known as honesty bonds, can help pay for losses if your employees (and with third-party fidelity bonds, contract workers) commit dishonest acts, such as the following:

• Theft
• Forgery
• Burglary
• Robbery
• Embezzlement
• Destruction of property
• Fraudulent trading
• Illicit transfer of funds
• Unlawful data access

Get the Right Coverage

With over a decade of experience serving Kirkland and the surrounding area, the dedicated agents at Absolute Insurance Solutions are well-versed in assessing and addressing the coverage needs of our clients. We will work with your organization to analyze your circumstances, explore your options and compile optimal selections. Contact us today to get started.