Six Basic Types of Business Insurance You Might Need

Successful companies of all sizes readily address their insurance needs so they won’t later be caught off guard by either a baseless or valid legal claim. No matter how hard you try to provide flawless products and services to the public, there’s always a chance that a defective product or business transaction may render you liable for legal damages.

Although only certain types of companies must carry workers compensation, disability and unemployment insurance to meet federal guidelines, all businesses can benefit from protecting their company assets by purchasing basic and special types of business insurance.

Fortunately, there are only six basic types of business insurance that you and your business partners must carefully review while trying to protect your company against future legal challenges. All six are set forth below with additional information.

Six common types of business insurance

Before reviewing the following types of insurance, be sure to thoroughly discuss the precise nature of all your business transactions with your insurance agent.

  1. General liability insurance. This will provide you with legal defense support for a variety of alleged wrongs. For example, your company may be sued based on a personal injury claim or the alleged statements of one of your employees. For example, if one of your customers is seriously injured while visiting one of your offices or factories, this policy can help you compensate the injured party for all bodily injuries and medical expenses. In addition, this same type of policy could protect you if a court holds one of your employees liable for business libel or slander — for damages up to the maximum amount of coverage stated in your policy.
  2. Product liability insurance. Even some of the most reliable products on the market will occasionally malfunction and harm a consumer. For this reason, you must secure an ample amount of product liability insurance coverage for this type of claim.
  3. Professional liability insurance. If your company provides any types of services to customers, you must carry this type of policy – often referred to as “E and O” (errors and omissions) coverage. This policy will cover the costs of defending your company in a civil lawsuit that may be based on the alleged grounds of malpractice (often medical or legal). The insurance industry doesn’t view these types of claims as eligible for coverage under either general liability insurance or a homeowner’s insurance policy.
  4. Commercial property insurance. Industrial fires, floods, windy hail storms and other natural disasters can quickly destroy critical manufacturing plants, office buildings and valuable inventory. Always be sure to carry ample coverage under this type of policy — based on recent property value appraisals.
  5. Home-based business insurance. This type of policy is usually offered as a rider to a person’s homeowner’s insurance. It provides limited coverage for such problems as business equipment and inventory damages. This type of policy can also provide funds to cover liability claims brought by injured third parties.
  6. A business owner’s policy. This general type of coverage can let you bundle nearly all (or most) of your insurance needs into one policy. If you pursue this option alone – make sure it adequately protects you regarding all the most unique aspects of your company’s goods and services.

When discussing your insurance needs with your lawyer and insurance agent

Always talk about every reasonable type of harm that your business might suffer. Also, make sure you’ve chosen the best type of partnership or corporate structure to further protect your personal and business assets. Once you fully understand all the risks your company might face, find a highly respected business insurance broker. Always ask trusted business peers for their recommendations for this type of agent.

Finally, speak with your Houston business law attorney about all the specific types of insurance required by the state of Texas for a company like yours. And be sure to address all the federal government’s insurance requirements. Keep in touch with your insurance agent and lawyer throughout each year so they can each readily update you about new legal or policy requirements that may affect your current coverage during the upcoming year.

Please feel free to contact a Murray Lobb lawyer so we can talk with you about the legal aspects of obtaining adequate insurance coverage for all your business needs.

Administering the Family Medical Leave Act (FMLA)

Prior to the passage of the FMLA in 1993, American workers had few options when they needed extra time off from work due to their own serious medical conditions and accidents – or those of immediate family members. In fact, workers often had to use up all their vacation and sick leave benefits, if entitled to any, and then worry about their job security if they needed more time off. (However, eligible women could seek the special help offered by the 1978 Pregnancy Discrimination Act). 

Fortunately, the Family Medical Leave Act is still helping many 21st century workers address critical family caregiving duties and remains one of the signature pieces of legislation from the Clinton era.

Here’s a brief overview of specific provisions of the act that can help your qualified workers.

What basic opportunities does the FMLA offer qualified employees?

If a worker meets the minimum qualifications referenced below, it’s possible to take up to twelve (12) weeks of unpaid leave during a calendar year to take care of seriously ill family members, new children or the individual’s own major medical condition.

In 2008, the Family Medical Leave Act was updated so that qualified workers could also take time off work to take care of immediate family members who became very ill (or were seriously injured) while serving in the military.

The FMLA guarantees that qualified workers can take the extended time off work without having to worry about losing their jobs, their seniority or their employer-provided health care insurance.

Which types of employees are qualified to use the FMLA?

  • Those who have employers with 50 or more workers on the payroll for at least 20 workweeks during the preceding or current calendar year. A worker may still qualify even if all the 50 workers aren’t working at the same site – if they work within a 75-mile radius of one another;
  • Those who have worked for their employer for a minimum of 12 months, for a total of at least 1,250 hours. This means that many part-time workers may not qualify for FMLA leave. However, there are special rules that may apply to workers who are teachers, are highly paid – or are flight crew members of airlines;
  • Employees taking time off from jobs to handle their own “serious health conditions” – or those of covered family members. This time may also be used to take care of a new child or a servicemember in the immediate family who has been wounded.

Note:  Now that same-sex marriage is legal in all 50 states, LGBT (lesbian, gay, bisexual and transgender) individuals can also qualify like other workers to take care of their family members.

General questions often raised about the FMLA by employers and employees

Question 1:   Can the leave time requested be intermittent during a calendar year?

Answer 1:     Yes, if all the time that’s taken is counted toward the maximum amount of time off

                     allowed (12 weeks).

Question 2:  What government agency oversees and administers the FMLA for all federal

                     employees – as well as all state and local government workers and private

                     employees?

Answer 2:   The U. S. Department of Labor’s Wage and Hour Division. This is noted in Fact

                   Sheet #77B entitled, “Protection for Individuals Under the FMLA.”

Question 3: Are all workers qualified to take time off from their jobs under the FMLA entitled

                     to receive pay while away from work?

Answer 3:    No. The FMLA doesn’t require employers to pay qualified employees while they’re

                    taking this type of leave. However, it’s up to your employer to let you make a claim

                    for regular vacation time, sick leave or annual time off.

Question 4: Can a qualified worker ever be granted more than 12 weeks of paid or unpaid

                     FMLA leave in one year?

Answer 4:   An exception only exists for qualified family caregivers of wounded

                    servicemembers. They’re allowed to take up to 26 weeks off from their jobs in a

                    given calendar year.

Question 5: Can a qualified worker request more than 12 weeks off under the FMLA to take care

                    of a newborn – or a newly adopted child?

Answer 5:   In general, the answer is “No.” However, individual states can pass their own

                   versions of the FMLA and provide somewhat different benefits. To date, the Texas

                   Workforce Commission says that Texas has not passed such legislation.

Although the Family Medical Leave Act is a straightforward piece of legislation, it’s been updated with new rules and regulations and interpreted by the courts. Therefore, it’s usually wise for employers to ask their Houston employment lawyer for help if they have any specific questions about properly handling FMLA issues.

Please feel free to contact Murray Lobb so we can help explain any specific aspects of the FMLA to you as you provide its benefits to your employees. We’re always available to research any questions you may have.