A Simple Guide to the Terms That Matter
Insurance has its own language, and it can be confusing. My philosophy is simple: if you're confused, it's my fault. This guide is a straightforward explanation of the key terms you'll encounter when protecting your business and your family.
General Liability
What It Is: This is the foundation for any business. It protects you if you're sued for causing property damage or bodily injury to someone else.
Ben's Take: For contractors, having a $1 million policy is your non-negotiable ticket to getting hired by any legitimate company.
Workers' Compensation
What It Is: This covers medical expenses and lost wages for employees if they get injured on the job.
Ben's Take: Even if you're a solo operator, most general contractors will require you to have this policy to protect everyone on the job site. Ignoring a work comp audit is one of the fastest ways to get financially penalized.
Commercial Auto
What It Is: A policy that covers vehicles used for business purposes.
Ben's Take: This is one of the most common and dangerous gaps I see. Your personal auto policy will almost certainly not cover an accident that happens while you're driving for work. If you use your car for business, you need a commercial policy.
Inland Marine (Tool & Equipment Coverage)
What It Is: Despite the weird name, this policy covers your business property (like tools and equipment) when it's on the move or at a job site.
Ben's Take: Your General Liability policy does not cover your own tools if they're stolen. If your tools are your livelihood, you need this coverage.
Personal Umbrella Policy
What It Is: An extra layer of liability protection (typically $1 million or more) that sits on top of your existing home and auto policies.
Ben's Take: For successful professionals, this is the most important policy you can own. It is the most cost-effective way to shield your assets from a catastrophic lawsuit.
