What business insurance does a start-up company need?

Business insurance is a highly important part of enterprise, to help protect the business from lawsuits and other financially damaging claims, to help protect employees, and of-course, to help protect business resources which are fundamental to the livelihood of any business.

While large and well established companies will have all kinds of insurance to help minimize damages and maximize prosperity, many start-up companies become confused over what insurance is needed as the first steps are made. They don’t want to spend more than they have to with needless cover, but they also don’t want to find themselves unprotected if mishaps do occur. To help, information is provided below on what insurance is required for the two major start-up business stages – research and development and early growth.

Research and development stage

The beginning stage of a company’s life is when ideas and relationships are being formed, and funding is sought after. Usually the work environment will be small with few employees and systems, but insurance is still required for property, assets and employees. General liability insurance is required for any commercial space, property insurance is needed to cover damage and theft, business income insurance provides protection against loss of income following profit loss or increased costs, and workers compensation and disability insurance is needed by law.

Early growth stage

Other forms of insurance will be required when a business acquires funding, and starts to launch products and services and employ more people, and this is usually related to the insurance needed when entering contracts with clients. Insurance for errors and omissions protects against financial loss to a third party, and management insurance protects from shareholder and other related lawsuits. Crime protection insurance, global insurance policies and employee benefit schemes are also needed.