Florida has the fourth largest economy of America’s 50 states. Small business, defined as any company with fewer than 500 employees, is a key factor. Of Florida’s 2 million small businesses in 2008 (the latest data available), 410,339 were small employers, accounting for 98.9% of all employers in the state and 44.1% of its private-sector employment. Another 1,608,887 were one-person operations with no employees.
Source: SBA Florida Small Business Profile 2008.
About Commercial Liability Insurance for FL Businesses
Commercial liability insurance (also called business liability insurance and commercial general liability insurance) protects your Florida business from financial loss resulting from claims of injury or damage cause to others by you or your employees. A policy typically covers:
Bodily Injury – physical damage to a person other than an employee at your place of business and injuries caused by you or an employee at a client’s home or work place.
Property Damage – damage caused by you or an employee to someone else’s property.
Personal Injury – libel, slander, copyright infringement, invasion of property or privacy, wrongful eviction, false arrest and similar acts that cause damage to a person’s reputation or rights.
Advertising Injury – losses caused by your advertising
Legal Defense and Judgments – costs to defend against real and frivolous suits and judgments up to the limit of your coverage. Note this generally does not include punitive damages for negligence or willful misconduct.
Florida Minimum Business Insurance Requirements
Commercial Liability Insurance is not mandatory for businesses operating in Florida. Although there is a movement for tort reform in Florida, the state has a reputation for being litigious and the courts are known for awarding large judgments in favor of plaintiffs. If you own property or other valuable assets you would be wise to invest in sufficient commercial general liability coverage for your Florida business to limit your risk exposure.
How Much Florida Liability Insurance Should You Carry?
Each situation is unique, but as a general guideline, the type of Florida business you operate or products you manufacture should determine how much Florida commercial general liability insurance you need. A good rule of thumb for most small businesses is between $500,000 and $1 million. However, if yours is a high-risk business such as the building trades or has a high volume of interaction with the public such as a retail business, you should consider increasing your coverage. Note that if you operate out of your home, your homeowner’s or renter’s insurance has limited coverage for business liability and loss.
How Are Premium Costs Assessed?
Florida commercial liability insurance premiums are based on a number of factors including the types of service or products you provide, the number of people you employ, how long you’ve been in business, and your claims history. Coverage is typically capped at a specific dollar amount for your policy period.
Other Insurance to Consider for Your Florida Small Business
Workers Compensation Insurance is required for any Florida business with at least four full or part-time employees. Note that partners and sole proprietors do not count as employees in Florida. For the construction industry, workers compensation is required for just one full or part-time employee. Different requirements apply to the agricultural industry.
Florida requires that all drivers carry minimum automobile insurance. If you use cars or trucks for your business, you are required to purchase a commercial vehicle policy in Florida.
Short-Term Disability Insurance
BOP – Business Owner’s Package
E&O – Errors & Omissions
EPLI – Employment Practices Liability Insurance
Supplemental Hurricane & Flood Damage Insurance
Regulating Agency and References
Florida Office of Insurance Regulation
This agency is responsible for regulating vehicle insurance policies sold in Florida. For more information, visit their website at www.floir.com
(850) 413- 3140
Florida Office of Insurance Regulation
200 East Gaines Street
Tallahassee, FL 32399.
Florida Small Business Administration
The SBA is an independent agency of the federal government created to aid, counsel, assist and protect the interests of small business concerns and maintains Florida district offices in Jacksonville and Miami. Get links to district offices at http://www.sba.gov/
National Association of Insurance Commissioners (NAIC)
This is an organization of insurance regulators from the 50 states, District of Columbia and the five U.S. territories. NAIC provides a forum for the development of uniform policies when appropriate. It also offers an online form for filing complaints, reporting suspected insurance fraud and downloading key financial information about insurance carriers at www.naic.org
Insurance Information Institute (III)
This organization’s mission is to improve public understanding of insurance – what it is and how it works. Visit III at www.iii.org/