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Different Types of Small Business Insurance Required by Law

Starting a small business is an exciting venture. But as any business owner knows, running a business comes with a lot of responsibilities – including protecting your employees, customers, and property. One way to do this is by carrying the right insurance.

The type of small business insurance required by law varies from state to state. But in general, most businesses are required to carry workers’ compensation and unemployment insurance. Some businesses may also be required to carry disability insurance, property insurance, and liability insurance.

Here’s a closer look at the different types of small business insurance required by law in the US:

1. Property Insurance

This type of insurance covers damage to your business property, such as your office or store, from events like fire, theft, or vandalism. It can also cover the contents of your business, such as inventory or equipment.

2. General Liability Insurance

This insurance protects your business from claims of negligence or damages caused by your business activities. It can cover expenses like medical bills, legal fees, and property damage.

3. Product Liability Insurance

If your business sells products, this insurance can protect you from claims of injuries or damages caused by your products.

4. Business Interruption Insurance

This insurance can reimburse you for lost income and expenses incurred if your business is forced to close due to a covered event, such as a fire or natural disaster.

5. Workers’ Compensation Insurance

If you have employees, this insurance is required in most states. It covers medical expenses and lost wages for employees who are injured or become ill as a result of their job.

6. Professional Liability Insurance

Also known as errors and omissions insurance, this insurance protects your business from claims of professional negligence. It can cover expenses like settlements, judgments, and legal fees.

7. Vehicle Insurance

If your business uses vehicles, you’ll need to have commercial vehicle insurance. This insurance covers vehicles used for business purposes, such as delivery trucks or company cars.

8. Cyber Liability Insurance

This insurance covers your business from claims related to data breaches and cyber-attacks. It can cover expenses like notification costs, credit monitoring, and data recovery.

9. Employment Practices Liability Insurance

This insurance protects your business from claims of employment discrimination, sexual harassment, and other employment-related issues.

10. Directors and Officers Liability Insurance

This insurance protects individuals who serve on your company’s board of directors or executive team from personal financial losses due to wrongful decisions or actions.

While this is not an exhaustive list, it covers the most common types of insurance that small businesses are required to have.


Carrying the right insurance is an important part of being a responsible business owner. Make sure you know the small business insurance requirements for your state so you can protect your business and your employees, customers, and property. Also, make sure to consider the insurance policies that aren’t required. Some of these policies can cover the things you may want insured to give your business full protection so that if something goes amiss, you don’t get run down by financial challenges you cannot overcome.

The Tabb Insurance Agency offers various insurance plans and quality services to meet your personal and business needs. If you are looking for business insurance in Conyers, GA, work with us today!