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Sole Proprietor Business: What Type of Insurance Liability Do You Need?
Posted by Klinger Insurance Group on
Running your own business is truly like riding a roller coaster that doesn’t stop: there are a lot of incredible ups and downs. It can be thrilling, overwhelming, determined, anxious, and sometimes all at once. As the owner of a sole proprietorship, you’re used to wearing many different suits to get the job done. All in one, you’re CEO, director of the strategy, chief of marketing, and chief of finance. As a result, you have complete control of your business and you are responsible for all facets such as business debts, taxes, social security, medical taxes, and legal liabilities
What is Sole Proprietorship?
Sole proprietorship is a type of business owned and run by one person or also known as a sole trader. As the sole proprietor, you are responsible for income tax, business debts, social security, medical taxes, and legal liabilities.
What are the Pros and Cons of Sole Proprietorship?
You have complete control of your business under your own terms.
You enjoy the perks of working on your own.
You receive all the business profits
Fewer registrations, easy to set up, and low cost.
Less paperwork to get started.
Uncomplicated processes and fewer requirements for business tax.
Personally liable for all business debts, taxes, and medical expenses.
It’s harder to get financing and business credit.
Difficult to raise capital on a long-term basis.
It’s harder to sell your product or service.
No liability protection.
As a sole proprietor, you also want to make sure that your business is secure and protected from liability risks and lawsuits. With the help of the right insurance coverage, you can lean on a more secure foundation and quell your worries.
Why Should You Consider Sole Proprietor Insurance?
Sole proprietor liability insurance is specifically designed for the bustling sole trader, solopreneur, sole proprietor. This insurance provides liability coverage and can help cover claims against data breaches, customer or bodily injuries, and loss of income.
What Type of Insurance Coverage is for Sole Proprietors?
Different businesses have different risks. Learn more about the type of sole proprietor insurance and choose depending on the specific needs of your business.
General Liability Insurance
General Liability Insurance is a must-have for most small business owners. It can help you to cover the cost of property damage, lawsuits, and bodily injury.
Let’s say, your customer gets injured in your business, This insurance policy can help you cover their medical expenses.
Professional Liability Insurance
Professional Liability Insurance also called Error and Omissions insurance or E&O. This type of insurance can help you protect your business and cover claims of misrepresentation, inaccurate advice, and negligence. For example, you fail to secure clients’ orders on time and then need to secure a new expensive supplier at the last minute. As a result, they could sue you for negligence. This insurance policy can help you cover the additional costs or legal liability.