Starting a new business is exciting—but also full of decisions, including how to protect your business from financial risks. From unexpected lawsuits to property damage, having the right insurance coverage can mean the difference between success and financial hardship.
If you’re just starting out, you may be wondering:
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What types of business insurance are required?
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Which policies are optional but highly recommended?
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How much does small business insurance cost?
This guide breaks down the essential insurance policies for new small businesses, so you can launch your company with confidence.
1. General Liability Insurance: The Must-Have Policy for Any Business
Why You Need It:
No matter your industry, general liability insurance is a fundamental coverage that protects against third-party injuries, property damage, and legal claims.
Example: A customer trips on a loose mat in your store and breaks their ankle. Without general liability insurance, you’d be responsible for medical bills and potential legal costs.
Who Needs It?
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Retailers, restaurants, and service-based businesses
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Home-based businesses (yes, even online businesses can be sued!)
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Contractors and freelancers working with clients
2. Business Property Insurance: Protecting Your Physical Assets
If your business owns equipment, inventory, or office space, business property insurance is essential. It covers fire, theft, vandalism, and storm damage to your property.
What’s Covered?
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Office space, warehouses, or leased retail locations
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Business equipment, computers, and inventory
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Loss of income if a disaster forces you to temporarily close
Who Needs It?
Brick-and-mortar stores, home-based businesses, and any business with expensive assets.
3. Workers’ Compensation Insurance: Required if You Have Employees
Workers’ compensation insurance covers medical expenses and lost wages for employees injured on the job. It’s legally required in most states as soon as you hire your first employee.
Example: A new café owner hires a barista who burns themselves with hot coffee. Without workers’ comp, the business owner would have to pay out-of-pocket for medical treatment.
Who Needs It?
Any business with employees (even part-time).
4. Business Interruption Insurance: Keeping You Afloat During Unexpected Closures
What happens if a fire, hurricane, or other disaster forces you to shut down temporarily? Business interruption insurance replaces lost income so you can keep paying rent, employee wages, and other expenses.
Who Needs It?
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Restaurants, retail stores, and service businesses
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Businesses in areas prone to natural disasters
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Any business that would struggle to cover operating costs if forced to close
5. Professional Liability Insurance: Protecting Against Mistakes & Lawsuits
Also known as Errors & Omissions Insurance (E&O), professional liability insurance protects businesses from lawsuits due to negligence, errors, or bad advice.
Example: A marketing consultant gives a client poor advice that leads to lost revenue. The client sues for damages—E&O insurance covers the legal costs.
Who Needs It?
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Consultants and freelancers
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Accountants, attorneys, and service-based businesses
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Any business that provides advice or services to clients
How to Get the Right Insurance for Your New Business
Every business is unique, and choosing the right coverage doesn’t have to be overwhelming. At Schneider Insurance, we help new business owners get the protection they need—without the confusion.
Schedule a Consultation Today
Call us at 251-666-5472 or fill out our contact form to find the best insurance plan for your business.
