Getting a start-up from dream to reality is a 24-hour-a-day job for months. There is so much to do: lining up suppliers, marketing for customers, getting funding, hiring the right staff.

The nuts and bolts of a launch take time, energy and money. And anxiety: “Have I forgotten anything?” What about business insurance for your start-up? It’s easy to overlook this critical part of your business start-up success. The right package of insurance will protect your company as it grows.

Here is a look at what types you need and where you can find it.

What Type of Insurance Do You Need?

According to Entrepreneur Magazine, every start-up needs at least five types of coverage:

• Comprehensive general liability
• Directors and officers liability
• Cyber/media insurance
• First-party property insurance
• Employment liability insurance

To this list, Baremetrics and other business groups add:

• Worker’s compensation insurance/disability insurance
• Errors and omissions insurance
• Key person insurance
• Health and employee benefits insurance

In your start-up timeline, there are five events that trigger the need for business insurance. These are:

• Hiring staff
• Closing a new level of funding
• Moving to a new office
• Signing up clients
• During a growth spurt

Eliminating the Confusion

That’s a lot of insurance! Do you need it all? Conflicting information is the norm when it comes to insurance. It’s all too easy to fall into the persuasive clutches of an agent that simply wants to sell you anything he can in order to make a commission.

Few business owners understand the complexities of business opportunity insurance and franchise insurance.

You need to consult with your lawyer and accountant to decide which coverage is required for your specific business. There are many factors that influence what types of policies you should invest in.

Don’t be intimidated by insurance policies and advice. Treat your insurance coverage as a company asset. Maximize its usability just like you do your trucks and cars and office equipment.

That means being clear about what tasks people in your business do and the implications of your company actions. Research what other businesses like yours have for coverage. Too much insurance or policies that aren’t appropriate simply waste money.

Where Can You Get the Best Insurance?

Pricing policies takes time, effort and expertise. That’s why a number of companies have positioned themselves as one-stop insurance stores focused on the needs of start-ups. Since everything you need for insurance is in one place, your shopping is much easier and far less time-consuming.

One of the most highly regarded is FounderShield. It’s target market is the venture-backed start-up and its mission is to “take the stress out” of buying insurance. It offers:

• Everything in one place, with a wide choice of policies to choose from
• Digital applications that use advanced technology. They are proud that their applications don’t require a fax machine.
• Quick response time
• Policies and packages created for start-ups. The founders have started their own firms, so they know what you need.
• The ability for buyers to scale up quickly and easily

Don’t overlook the opportunity for business insurance during your start-up period. The right insurance will protect you and provide peace of mind.

SOURCES: Entrepreneur Magazine, Harvard School of Business, FounderShield

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