What are the requirements for business insurance in Pennsylvania?
The Pennsylvania Department of Insurance requires all businesses to carry workers’ compensation insurance if they have employees, including part-time and temporary workers. This includes domestic employees such as maids, nannies, or caretakers. Exceptions include employers with only corporate officers, family members of sole proprietors, or real estate agents working on commission.
Pennsylvania also requires businesses to carry unemployment insurance if one employee or more for at least 20 weeks per year. Liability insurance is required in Pennsylvania for most professions and occupations. These liability requirements are put in place to protect the public from negligence and wrongdoing on behalf of professionals and businesses. If you’re unsure whether liability insurance is required for your business, contact the Pennsylvania Department of Labor.
What are the types of business insurance in Pennsylvania?
Here’s a look at some of the most common types of business insurance and what they cover:
General liability
This policy protects businesses against lawsuits and claims filed by third parties. It covers damages, medical bills, and other expenses related to injuries and property damage caused by the business or its employees. It also covers advertising injuries, such as copyright infringement or libel, which occur in doing business.
General liability policies don’t protect against professional malpractice, faulty artistry, or damage to company property. They also don’t cover employment-related claims, such as discrimination or wrongful termination.
Workers compensation
Workers comp insurance helps protect your business from work-related injuries or illnesses that can occur at any moment. Although workers’ compensation insurance provides coverage for a broad range of risks, it excludes some types of losses, injuries, and illnesses. By understanding these exclusions, you can take steps to protect yourself, your employees, and your business.
The policy may exclude independent contractors or other workers who are not considered employees, such as contractors or domestic help. Intentional injuries: Workers’ compensation policies typically do not cover injuries that the employer or employee intentionally inflicts.
Commercial property insurance
Commercial property insurance usually covers the physical damage to your business’s property caused by a covered peril, such as fire, lightning, or wind. It may also cover the loss of business income if your premises are damaged and you have to close temporarily.
It’s important to note that commercial property insurance doesn’t cover certain disasters such as flooding, earthquakes, war, and nuclear hazards. If you live in an area at risk for these types of disasters, you can purchase additional coverage.
Product liability
Product liability protects you against claims of harm caused by your products. You may have a product liability claim if a customer is injured by a product purchased from your business. The claim can be brought directly against your company by the injured customer, or the customer may sue your product manufacturer.
The main things that product liability insurance excludes are defects in design or manufacture (warranties cover this), injuries or damages that occur outside of the U.S., and the cost of recalls.
Commercial Auto insurance
Commercial auto insurance policies provide coverage for vehicles used for business purposes. They apply to all businesses, and many companies offer commercial auto insurance policies. Multiple factors determine the cost of a commercial auto insurance policy, such as the type of car being insured and the type of business being run.
Commercial Auto excludes:
Off-road use (unless it’s necessary to conduct your business)
Delivery or transportation of flammable liquids
Use of any vehicle to carry more passengers than it was designed for.
How much does business insurance cost in Pennsylvania?
Your business is unique, and so are your insurance needs. Insurers take several factors into account when calculating your premiums. Here are the main factors that insurers consider:
- Company size: The larger your company, the more expensive its premiums will be. This is because larger companies tend to have more assets, are busier, and have a higher risk of an accident or liability claim.
- Your business location: Depending on where you’re located, you may pay a higher premium for business insurance. For example, businesses in areas with high crime rates or located in flood plains are considered at greater risk than those in safe areas or outside of a flood plain.
- Claims history: Insurers will often increase premiums based on claims history for your business and the industry as a whole. Companies that frequently file claims will pay more for insurance than those with a clean record. If many companies in your industry file claims, this can also increase your premiums because insurers view it as an industry-wide risk.
- Coverage limits: Higher limits generally mean higher costs. That’s because the insurance company is taking on more risk by offering you more protection.
- Business Activities: if you own a food truck, that may involve different risks than if you owned a law firm. Certain industries will be considered riskier than others based on how likely they’ll need to file an insurance claim and, therefore, cost more to insure.
How to choose the best business insurance in Pennsylvania
Before you purchase business insurance, here are some tips on how to choose the right coverage for your company:
- Consider how much coverage you need: You don’t want to be underinsured, but you also don’t want to spend more than you need to spend. You can get a good idea of how much insurance is appropriate by working with an insurance agent.
- Check on your local laws: Before meeting with an agent, check out the laws in your state regarding insurance. This will help you know what kind of insurance is required by law and help you make sure you’re covered for everything before meeting with an agent.
- Shop Around: Don’t just pick the first plan that comes along. Take some time to make sure it’s the right one for you and your
- Experience: Obviously, you want an insurer familiar with your industry and its risks. The more experience they have in your field, the better they will understand your company’s risk profile and what coverage you need.
- Know what’s included and excluded: The last thing you want is for an incident to happen and then learn that your policy doesn’t cover it, leaving you on the hook for thousands of dollars.