Starting a business is exciting. You’ve got the idea, the drive, maybe even a team—but have you protected everything you’ve built? One overlooked (yet critical) piece of the puzzle is business insurance.
Whether you’re running a one-person Etsy shop or managing a growing team in a downtown office, the right insurance can mean the difference between surviving a crisis—or closing your doors.
Here are the five essential types of business insurance every entrepreneur should know about:
1. General Liability Insurance
This is the foundation. It protects your business from claims involving bodily injury, property damage, and even advertising mistakes. If a customer slips on your floor or you accidentally damage someone’s property while working on-site, general liability insurance helps cover legal and medical costs.
Best for: Almost every business
Pro tip: Many clients require you to have this before signing a contract.
2. Professional Liability Insurance (Errors & Omissions)
If your business provides advice, services, or consultation—think designers, consultants, or accountants—this is for you. It covers you if a client claims your work caused them financial loss due to a mistake or failure to deliver as promised.
Best for: Coaches, consultants, marketers, financial advisors
Pro tip: It doesn’t matter if the claim is unfounded—you’ll still need to defend yourself legally.
3. Commercial Property Insurance
Own a storefront, office, or inventory? This covers physical assets like buildings, computers, equipment, and supplies from damage due to fire, theft, storms, and more.
Best for: Brick-and-mortar businesses, manufacturers, retailers
Pro tip: Even if you rent your space, your equipment and contents still need coverage.
4. Workers’ Compensation Insurance
If you have employees—even just one—most U.S. states legally require this. It covers medical bills and lost wages if an employee gets hurt on the job.
Best for: Any business with employees
Pro tip: Fines for not having workers’ comp can be massive. Don’t skip this.
5. Business Interruption Insurance
Also called “business income insurance,” this covers lost income if you have to shut down temporarily due to a disaster (like a fire or major flood). It helps you stay afloat while you rebuild.
Best for: Restaurants, retail shops, event venues
Pro tip: Often bundled with commercial property insurance as part of a Business Owner’s Policy (BOP).
Final Thoughts
Insurance may not be the most glamorous part of entrepreneurship—but it’s one of the most important. Without it, one accident, lawsuit, or disaster could wipe out years of hard work.