Business insurance is an important part of any company’s security. It prevents a business from going under in the event of an unexpected natural disaster or human error. With so many different options to choose from, it can be difficult to find the perfect plan for your business. We’ve evaluated the best business insurance providers based on coverage, financial stability, customer satisfaction, and overall quality.
Coverwallet began its journey in New York City in 2015 operating under the
Aon Insurance banner. At Coverwallet, you can access everything you need to
keep your company well-protected at an unbeatable price.
With a 100-year history of insuring businesses, Hiscox is well-known across
America and globally. With more than 500,000 small business customers,
Hiscox is fully aware and trained in the unique risks a business can face.
Thimble provides business insurance that can be tailored to your business by
the year, month, day, or even the job. At Thimble, the process to getting
the right business insurance is simple, scalable, and flexible.
What are the requirements for business insurance in Alabama?
To be eligible for business insurance, you must meet the following criteria:
Be registered with the state’s Secretary of State Office
Be properly incorporated in accordance with the laws of Alabama
Have a physical location within the state
Operate legally within the state limits
Alabama requires all businesses to maintain general liability insurance. General liability covers costs associated with bodily injury, property damage, and personal injury claims against your company. The minimum required amount is $100,000.
Additionally, your business may require other types of insurance based on its industry. For instance, you may need to carry workers’ compensation if you have more than five employees or staff. To find out which types of coverage are required by Alabama law or recommended by your industry association, contact your local business bureau or an insurance broker.
What are the types of business insurance in Alabama?
There are many types of business insurance, including:
Property insurance
Property insurance is purchased to protect against physical loss or damage to your business’s property. It includes coverage for buildings, inventory, and other items you own.
Here are four things you need to know about what is excluded in the property business insurance plan.
Theft by a person who works at your company
Property used for illegal purposes
Property used for military activities
Any claim caused by or arising out of pollution
Workers’ compensation insurance
This type of coverage insures against injuries and death sustained by employees on the job. It also covers medical expenses related to job-related injuries and provides reimbursement for lost wages incurred as a result of an employee’s injury or death.
There are certain situations where the worker’s compensation plan does not provide coverage to your employees.
Here is a look at some of the exclusions in a typical workers’ compensation plan:
If an employee is intoxicated or under the influence of drugs when he meets with an accident.
If an employee causes damage on purpose or intends to harm himself.
When an employee is involved in any illegal activity or act while at work
If an employee has a pre-existing injury and it leads to relapse or worsens during work.
Commercial auto insurance
A car driven for business purposes is not covered under personal auto policies; it must be insured separately through a commercial auto policy (also known as a fleet policy). Commercial auto policies provide protection from claims arising from such things as bodily injury and property damage suffered by others in connection with your business use of vehicles. But, there are certain things that this policy won’t cover. These are the things that you should know before buying a commercial auto insurance business insurance plan.
The personal use of the vehicle by the owner or employees
Injuries to passengers
Damages to any property if you are driving in prohibited areas or restricted areas
General liability
This covers property damage or bodily injury that occurs on your premises or during an event hosted by you. The coverage amount is usually a percentage of your total assets. General liability also covers advertising injury to your customers, in addition to bodily injury or property damage caused by your employees on company time.
The general liability business insurance plan has a few exclusions. For example, it does not cover:
Property damage or personal injury to employees and partners of the business owner.
Damage or destruction of your property.
Advertising injury arising out of physical injury to people and damage to their properties.
Any contractual obligation that arises out of the business operations.
Any loss arising out of a criminal act or wrongful behavior by the business owner or their employees.
Professional liability
This protects you if someone makes an error in judgment, error in procedure, negligence, or malpractice involving anything related to his/her professional duties while working on your company’s behalf and causes injury to another individual or damage to property belonging to someone else.
Even with the best professional liability insurance policy, there are a few exclusions to keep in mind. The following are some of the most common:
Punitive damages or criminal penalties
Property damage (unless required by a contract)
Intentional acts (such as theft or fraud)
Professional services performed prior to the inception date of the policy
Personal injury (such as slander or libel)
Taxes, fines, levies, and other penalties imposed by governmental authorities
Business Owners Policy (BOP)
A Business Owner Policy (BOP) combines all the coverages most businesses need, including property, liability, and others. A BOP policy is an all-inclusive package policy for your business. It was originally created for sole proprietorships and small businesses with few employees. It can be used for almost any type of business, no matter how many owners or employees you have.
There are, however, exclusions to what is covered in a BOP, so it’s important to know what they are when you shop for business insurance. Here are some of the main exclusions under a BOP:
Natural disasters
Employee theft or dishonesty
Professional services
How much does business insurance cost in Alabama?
Business insurance costs vary widely depending on the following factors:
Nature of your business: The riskier the nature of your business, the more expensive your policy will be. If you’re in danger of having a major catastrophe or accident destroy your company, you’ll have to pay more money for insurance coverage. For instance, if you run a lumber yard, your risk factor is lower than if you run an auto shop, so your insurance costs will be lower as well. Other factors include whether you’re running a restaurant or other foodservice establishment or whether your workplace may include hazardous materials like chemicals or explosives.
Company size: the larger your company, the higher the premiums. Underwriters want to know they will get their money back if something happens to you financially and you can’t cover your obligations. They also take into account that large companies have more employees who could be tempted to steal from their employer or cause other damage.
Your business location: Your premium cost may increase if your business is located in an area with a high crime rate or near a natural disaster zone. Insurance agents compare areas using the crime index, which shows how much crime occurs in that area or region of town.
Coverage limits Coverage amounts vary from company to company, as well as from policy to policy within a company’s offerings. The more coverage you select, the higher the premium will be for that coverage.
Claims history: How often have you filed claims in the past, and what kind? If your business has filed claims repeatedly or sought large payouts, you can expect to pay higher premiums than a company with a clean record.
How to choose the best business insurance in Alabama
Here are some tips for making sure your policy is as comprehensive and cost-effective as possible:
Look at all options: There are dozens of different types of commercial insurance policies available, ranging from general liability to workers’ compensation, and business interruption. Businesses with specific needs should seek out policies that address those needs. For example, a shop owner might carry flood-insurance coverage if the store is in a flood zone but skip it if the shop is miles from any body of water.
Know what is covered and what is excluded: Ask about exclusions and special clauses in the policies you’re considering. They might not look like much at first glance, but exclusions can leave you vulnerable if something bad happens. An exclusion clause might mean that an insurer won’t cover certain losses or damage caused by certain events.
Consult professionals: Get help from your agent when choosing a business insurance policy that best fits your needs. They can explain the different types of coverage available to you and help you determine which type of policy is most important to protect your company.
Find out what’s required by law: Some parts of insurance are mandatory. For example, you’ll have to have workers’ compensation insurance if you hire employees and a liability policy if someone is injured on your property or if one of your products causes injury or damage to someone else’s property.
