One of the most populated landlocked states in America, Arizona makes for a perfect setting for a business. With its dramatic Grand Canyon, and long- winding Colorado River, Arizona is a sight for tourists and residents to behold. It’s low humidity and warm climate makes doing business in Arizona a dream for young and old alike. Other perks of business in Arizona include its great cities, like Phoenix, Tuscon, and Mesa, abundant golf courses, and its growing population. All of these reasons make Arizona a great spot for both startup and existing small businesses looking to expand. But discerning Arizonan business owners are well aware that business insurance in Arizona is a must: Here’s a bird’s eye view of the various types of business insurance in Arizona:
Standard Business Insurance Coverages in Arizona
Also called a BOP, a business owners insurance in Arizona policy is an across-the-board compilation of small business insurance. It consists of a bundle of liability coverages together, but in a solo policy. The two most common types of coverages in a business owner’s insurance policy is general liability and property insurance. Legal liabilities, equipment, and buildings are all types of coverages in business owner’s insurance in Arizona. Notably, a business owner’s insurance policy helps to transfer risk from the Arizonan business owner to the insurance carrier. Arizona business owners insurance protects the small business owner from a host of claims, such as legal liability claims, personal injury, property claims, and professional liability claims. Income loss, valuable papers, money and securities, fire, and equipment breakdown claims may also be included in a BOP.
General liability insurance is set up to protect Arizona small business owners from financial destruction resulting from negligent exclusions, acts or both. These actions could be the result of something you did or even your employees. Regardless, physical injury or property damage happens as a result of the act. Accidents on the insured premise, contractual liabilities, or liabilities from products sold are all examples of the types of exposures commonly covered under general liability insurance in Arizona. The damage or injury doesn’t have to be intentional; it can also be through negligence. Some Arizonan’s purchase general liability insurance in Arizona as a standalone insurance policy, but others combine it with their other business insurance policies.
A package policy is an insurance policy for the Arizona small business professional which is comprised of a single insurance policy, but combines more than one type of insurance into a package. A popular package policy in Arizona combines general liability insurance (explained above) and commercial property (explained below). However, a package policy can be designed to include practically any type of coverage, depending on the needs of the Arizona business. A package policy is valuable for the Arizonan business owner since it allows fabulous flexibility to customize a unique policy particularly for the unique needs and risks of the Arizona small company.
Arizona commercial property insurance is intended to render coverage for any class of commercial property. The protection includes not only includes structure, and inventory stockpile, but also, office furniture, supplies, personal property, and valuable papers. Commercial property insurance protects Arizonan small business owners against a number of perils. These include damage from vandals, as well as theft and fire. Weather events, such as a lightning strike, hail, natural disasters, and windstorms. Commercial property insurance is recommended for a variety of Arizona small businesses, including not-for-profit agencies, service-based businesses, manufacturers, and retailers.
Does your Arizona business have employees working for you? If so, workers’ compensation insurance is absolutely critical. Not only does it provides coverage for your employees against work-related injuries, but also for illnesses acquired while on-the-job. Workers’ compensation insurance in Arizona is a state-mandated insurance program set up to help workers who sustained bodily injuries or an illness while performing their tasks. Because the state of Arizona requires both large and small businesses with employees to carry workers’ compensation, failure to carry it may lead to civil penalties and severe fines, or in some cases, result in the Arizonan being liable for the medical cost of injuries suffered by their employees. Through workers’ compensation insurance in Arizona, employees receive compensation for wages lost and health care coverage. In return, Arizona employee fulfills a promise that he will not file suit against his small business employer.
Whether your business is in Phoenix or Tuscon, if it owns just one vehicle, it’s vital to be safeguarded with commercial auto insurance in Arizona. Commercial auto insurance provides financial protection to business owners and their drivers by providing coverage for an entity’s use of trucks, vans, cars, or other vehicles in the course of its business. Commercial auto insurance in Arizona not only reimburses for hail and vandalism damage, but also medical costs resulting from car, van, or truck accidents. In addition to employee-owned vehicles used for your business, coverage may include vehicles rented, leased, hired, or borrowed by your company. That’s why it’s recommended that Arizona businesses purchase a commercial auto insurance policy if employees use their own vehicle to carry out work-related tasks for the business — this is considered non-owned commercial auto insurance.
Commercial umbrella insurance in Arizona takes up where your general liability, commercial auto insurance, or other liability coverage leaves off. In other words, your existing liability policies may have limits on coverage, and may not cover all expenses should a catastrophic or unforeseen event occur. Commercial umbrella insurance in Arizona is a critical aspect of protection that fills in the holes. It also covers certain exclusions in your primary business liability coverage. Umbrella insurance in Arizona represents an exceptional way to provide extra protection against property damage, bodily injury, or certain other liabilities.
Some Additional Business Insurance Coverages in Arizona to Consider
Errors and Omissions insurance policies protect Arizona small businesses and individuals from legal claims and claims made by clients or customers for inadequate work, negligent acts, errors, and oversights made while operating the business. Specifically, these claims result in a loss of income or productivity on the part of the customer or client. Errors and Omissions insurance covers litigation costs, as well as settlements as specified on the insurance contract. Similar to health care providers needing malpractice insurance, Arizona small business owners who provide services or consulting advice, either directly or through subcontractors, need errors and omissions insurance in Arizona.
Professional liability insurance in Arizona helps protect professionals, such as accountants, legal advisors, and from having to bear the legal costs associated with defending against a claim of negligence, error, failure to perform, or omission made by a client. Professional liability insurance in Arizona also provides coverage for claims that resulted in awarded damages you must pay. The coverage focuses on financial loss on the part of the client from these types of alleged claims with respect to a product or service sold by the Arizonan professional business owner. Professional liability insurance may provide defense coverage, even if the law suit is deemed to be groundless. Of course, for some professional practices, like the legal and medical professions, it is required. But professional liability insurance in Arizona is also required in other professions, according to the contract’s terms and conditions.
Employment Practices Liability Insurance (EPLI) provides Arizona small business employers with coverage against allegations associated with employment. These include a host of areas including: wrongful termination, mental anguish, discrimination, breach of contract, violations of wage laws, defamation claims, sexual harassment, false imprisonment, negligent hiring, slander, libel, and promotion decisions. Employment practices liability insurance in Arizona focuses on several acts and laws brought under Title VII of the Civil Rights Act of 1964, Age Discrimination in Employment Act, and Family and Medical Leave Act. The Equal Opportunity Employment Commission (EEOC) enforces all of these acts and laws.
Fidelity Bonds in Arizona
To protect the Arizona small business employer, he can purchase fidelity bonds. Losses protected under fidelity bonds in Arizona include criminal acts made by one or more employees, such as embezzlement, theft, or fraud. Because recovery from employee dishonesty practices is highly unlikely because the cash has already being spent, fidelity bonds exists an important source of armor for the Arizona small business owner who would otherwise have to take in such financial losses. While it’s important to have controls in place, such as close supervision and employee screening, many times you need to do more. Losses suffered from employee thefts of money, property, or securities are all covered under fidelity bonds insurance in Arizona. ERISA bonds, business service bonds, and standard employee dishonesty bonds are three most common types of fidelity bonds.
Surety Bonds in Arizona
A surety bond in Arizona is a binding agreement or contract among three parties: the principal, obligee, and surety (insurance company). Should a another Arizona party fail to meet an obligation, like carrying out the duties specified in the contract, it represents the promise pay a specified amount. A surety bond in Arizona protects the recipient against financial loss in the event that the contract isn’t fulfilled. On the other hand, the surety company bears the liability for nonperformance. In order to obtain financial compensation, a surety bond is generally needed. Arizona business owners may need a surety bond to promise to pay utility bills or Arizona state sales taxes. An Arizona contractor who is looking for work or to obtain a license, may need to post a bond. Surety bonds are used by many businesses, including health club owners, notary publics, mortgage brokers, medical suppliers, automobile dealers, and more. In a large number of cases, they are used in the Arizona construction industry. Because of the number of different types of small businesses that use and need these bonds, there are a many distinguishing characteristics of surety bonds in Arizona that provide a wide range of guarantees.
Whether you’re operating a computer consulting firm in Phoenix or a real estate office in Mesa, Arizona small businesses need to protect their property and financial assets in the event of a liabilities and other risks. In many cases, unexpected happenstances will be covered by standard business insurance, but in other cases they will not. Accordingly, Arizonan business owners may also want to take a look at some additional business insurance coverages. Business insurance is a necessary part of small business success, and astute Arizona business owners are well aware that a fool-proof business insurance plan is a number one priority.