Women’s Entrepreneur – LP

Liability Insurance for Women Entrepreneurs

Customized, comprehensive protection for women-led businesses and entrepreneurs

What Is Business Liability Insurance?

Business liability insurance protects business owners from losses due to unforeseen events that may occur during day-to-day business operations, including third-party bodily injuries and property damage.

It’s a type of financial protection that helps cover the costs associated with unexpected losses or liabilities a business owner may incur.

There are many types of insurance available for business owners. The type of coverage you need depends on several factors, including the type of company or startup and industry, location, the products and services provided, and annual revenue.

What Does Business Insurance Cover?

Business insurance is designed to protect a company from risks like property damage, legal claims, third-party injuries, professional negligence and more, depending on the type of coverage you choose.

A comprehensive policy may include the following coverages:

General Liability Insurance

General liability insurance covers claims of third-party bodily injury and property damage caused by your usual operations or on your business’s premises. It also covers allegations of defamation and false advertising and tenant’s legal liability to pay for damages to property that you lease, rent, or occupy but do not own.

Every entrepreneur or business owner should have a general liability insurance policy.

Product Liability Insurance

Product liability insurance covers any product (including food) you manufacture, distribute, or sell that causes physical or financial harm to others, such as third-party bodily injuries and property damage.

Product liability insurance is sometimes included in a general liability insurance policy.

Commercial Property Insurance

Commercial property insurance covers your workplace (store, office, warehouse), business contents (furniture, electronics, office equipment), and inventory or merchandise if damaged or destroyed by fire, water, a natural disaster, theft, or vandalism.

Business Interruption Insurance

Business interruption insurance covers a business owner’s lost income and operational overhead if you’re forced to close or cease operations temporarily following an insurable loss, such as a fire.

It’s designed to cover expenses such as mortgage, rent, or lease payments, net income lost, employee payroll, monthly utility bills, and loan payments.

Note: You must have commercial property coverage to add this type of insurance to your policy.

Professional Liability Insurance

Professional liability insurance, also called errors and omissions (E&O) insurance or malpractice insurance, covers claims against you alleging financial loss due to a service you provided and lawsuits alleging professional negligence, misconduct, and failing to deliver services as promised.

This type of coverage is necessary for entrepreneurs, independent professionals, and business owners that provide professional services or advice to their clients.

Cyber Liability Insurance

Cyber liability insurance covers the cost of recovering from and dealing with a cyber-attack or data breach and cybersecurity risks involving your technology systems and customer data.

Any business that uses technology (email, social media, cloud storage, a website, point-of-sale systems) should have cyber liability insurance.

It provides financial support for your legal costs, notification and crisis management fees, credit monitoring expenses, and repairs and restoration of your software systems affected by an attack or breach.

How Much Does Business Insurance Cost?

Insurance companies determine the annual premium (price) of an insurance policy based on a wide range of factors about your business and operations, including:

  • Your location
  • The type of business, its size, and industry
  • Your years of experience
  • The goods and services you provide
  • The types of insurance you select for your policy
  • The coverage limits and deductibles you choose
  • How many employees you have (if applicable)
  • Your annual and gross projected revenue
  • Your business insurance claims history

Who Needs Business Insurance?

No matter your business’s size or industry, insurance is essential for long-term success and financial wellbeing. 

Business liability insurance helps cover costs from unexpected events like third-party damage, claims of negligence, or faulty products.

Every business or entrepreneur is different, so your coverage needs may vary. Speak to a Zensurance broker if you have questions about what your policy should contain.

Is Business Insurance Tax Deductible?

Yes. The Canada Revenue Agency allows business owners to deduct commercial insurance premiums that you pay on any buildings, machinery, and equipment you use in your business.

Common Insurance Claim Examples

Coverage

Problem: A client visiting your office trips and falls on the stairs, is injured and requires medical attention.

Outcome: General liability insurance may cover the injured person’s medical and rehabilitation expenses.

Coverage

Problem: A fire in your office building causes damage to your office, furniture, and computer equipment.

Outcome: Commercial property insurance may cover the cost to repair the damages to the office and repair or replace your furniture and computer equipment.

Coverage

Problem: A consultant advises a client to invest in a specific advertising strategy. The strategy fails to generate expected results, leading to the client suffering a significant financial loss. The client sues you for professional negligence.

Outcome: Professional liability insurance may cover your legal defence expenses and any settlements or judgements against you.

Frequently Asked Questions

Does a self-employed professional or sole proprietor need business insurance?

Yes. Even as a self-employed professional, sole proprietor, or freelancer, you’re exposed to risks like lawsuits, property damage, or client disputes. Business insurance protects your personal and business assets.

Does business insurance cover lawsuits?

Yes. Most liability policies (like general liability or professional liability insurance) help cover legal defence fees, court costs, and settlements or judgements if your business is sued.

Does a home-based business need commercial insurance?

Yes. A home-based business often needs a commercial insurance policy. Standard homeowners insurance typically does not cover business-related risks.

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Other Resources for Women Entrepreneurs and Business Owners

The Zensurance Small Business Insights blog provides a wide range of insurance and risk mitigation tips, and news, trends, and tips for Canadian small business owners, startups, and entrepreneurs, including: