Every business in Ohio should have an insurance policy, but coverage should be tailored to the specific needs of the business. In other words, insurance policies do not come in a one-size-fits-all form. Rather, depending upon the type of business you own, you may want to consider specific types of coverage that fit the needs of your business. The following are descriptions of different types of insurance coverage that businesses often purchase and information about why it may be helpful to have these types of coverage.

Different Types of Insurance Coverage Your Business Should Consider

• General liability insurance: General liability insurance, or GL, is a broad-spectrum type of insurance that is often referred to as business liability coverage. It is designed to protect businesses from a wide variety of claims that can arise in the course of doing business, such as bodily injury claims and medical payments, property damage on the commercial premises, and advertising injuries.
• Directors & Officers insurance: Directors & Officers insurance is a particular kind of liability insurance that provides personal asset protection for directors and officers of corporations (and their spouses) in the event they face a lawsuit from an employee, an investor, a customer, or another party. D&O is important because it can safeguard personal assets in the event of a corporate lawsuit, and it can provide necessary coverage for attorneys’ fees and settlements. However, it is important to note that illegal actions taken by a director or officer typically will not be covered by D&O insurance.
• Cyber insurance: Cyber insurance coverage protects a business in the event of a data breach, according to Nationwide. Data breaches are happening more frequently, and this type of insurance coverage can be important to protect a small business if the computer system is breached and client data is compromised.
• Ransomware coverage: Ransomware coverage can be included in a cyber insurance policy. This type of coverage can protect you from cyber extortion, or a situation in which someone unlawfully uses ransomware to lock your computer system and require a ransom to provide the encryption key. This type of coverage can be helpful in the event of a ransomware attack.
• Accusations of intellectual property infringement: GL policies typically exclude coverage for intellectual property infringement, and as such a business must add in this type of coverage. This kind of coverage can protect your business from claims that may arise out of intellectual property infringement claims or lawsuits against you.
• Employment Practice Liability Insurance: This type of coverage, commonly referred to as EPLI, provides businesses with coverage in the event of a claim by a worker. EPLI can be essential for covering employers in the event of many types of employee lawsuits, such as sexual harassment, discrimination, and wrongful termination.
• Key man insurance: Key man, or keyman, is a type of insurance that is in effect a life insurance policy on the key person of the business. This type of coverage or clause can be important to protect a business if the primary employee dies unexpectedly.

Negotiating the Terms of Your Insurance Policy

The types of insurance coverage any business requires will depend on many different factors, and it is important to know about the various coverage options and why they can be useful. When you develop an insurance policy that meets the needs of your business, it is also important to negotiate a Choice of Counsel Endorsement into that insurance policy. Every insurance policy should have a Choice of Counsel Endorsement so that the business has more power in selecting counsel for representation in a claim for coverage or employment lawsuit.

If you have questions about insurance coverage and policy negotiations for your business, you should contact a business law attorney at Wells Law, LLC.