Having the right type of insurance for your business can be beneficial regardless of which state you live in. Business insurance allows you to avoid penalties, find new business opportunities, and safeguard your business assets after an accident occurs. In Texas, the requirements for obtaining business insurance are less stringent than in other states. In this article, we shall look at the types of insurance requirements that every business owner in Texas should meet.
Large and mid-sized employers
All mid-sized and large businesses have a stipulation regarding the type of business insurance they need. They need to provide insurance to employees for life, accidents, and health. Life insurance is coverage offered to an employee in case of a death. In return for paying a premium, a beneficiary receives an amount following the death of the employee.
Accidents occur frequently in the workplace. That’s why offering accident coverage through personal injury assistance policies is vital. Once you obtain such insurance, you need to submit proof of having it on the Texas Department of Insurance website.
Though not mandatory, some small organizations can choose to offer health insurance to their employees. According to Texas insurance law, a small business is one that employs between two and 50 employees irrespective of how many hours each employee works. If a small business employer provides health insurance, they must provide coverage to the employee’s dependents as well. If at least one of their employee enrols in an insurance plan, a small business owner may enroll themselves in the same business insurance plan.
As the business owner, you need to give your employees a minimum of 31 days from joining to enroll in their health insurance plan. Although you are not required to pay the premium for an employee’s insurance policy, some insurance companies might ask you to pay at least 50% of the premium. Per federal law, insurance provided by small employers needs to cover 10 types of essential health benefits in addition to other benefits. Plans that were bought before 2010 are not required to provide these benefits.
Safety in the workplace and worker’s compensation insurance
Typically, employee health insurance plans do not provide coverage for illnesses or injuries that happen at work. Instead, an independent worker’s compensation insurance policy is needed to offer coverage. Worker’s compensation insurance covers the cost of medical care and even lost income for employees who sustain injuries while being at work. This insurance also covers expenses for burial and other factors if a person dies while they were on the job.
The state of Texas does not require most business owners to offer worker’s compensation. However, private employers who enter into contracts with government organizations have to provide worker’s compensation to employees who are working on a certain project. Certain contractors could require their subcontractors to provide worker’s compensation for specific projects.
In general, having worker’s compensation is useful especially if you are working in hazardous sectors. If you do not provide this insurance, an employee might file a lawsuit against you over an injury in the workplace or an illness. If you have been sued in court, you will not be able to argue that the injury was caused due to negligence on part of the same employee or someone else. Typically, lawsuits pertaining to worker’s compensation can be expensive and to avoid them, you must satisfy several legal requirements for not holding the same insurance.
Providing worker’s compensation does not have to be expensive. In addition to purchasing a worker’s compensation policy from a licensed company, you could sign up for a self-insurance group. Or you could self-insure your employees’ compensation claims.
Commercial insurance for your property
Commercial property insurance is used to cover the costs of repairing or replacing your physical workspace and office equipment in the event they are damaged due to fire, rain, etc. It can also cover any lost revenue if your business is unable to run smoothly because of the above factors.
There are three types of commercial property insurance which protect different types of damages and losses. Basic form insurance policies cover damages due to fire, smoke, explosions, windstorms, vandalism, leakage, and other causes and provide the most basic coverage. Broad form insurance policies cover the above factors and damages caused by leaking appliances, falling objects, snow, sleet, etc. Maximum coverage is available through special form policies which protect businesses from all kinds of damages as stipulated in the policy.
This insurance covers you and your investor in case someone challenges the title in your property. This happens typically when there are defects in the title that you were not aware of at the time of purchasing the policy. This insurance protects the investor’s investment by compensating the mortgage amount if an issue with the title makes it invalid.
When you invest in a house, the title company would also produce an owner’s insurance policy unless you ask not to have it in writing. If you encounter any issues with your title, your title insurance can advise you on how you can file a claim and what your coverages, deductions, or exemptions will amount to.
Other types of coverage
In addition to the above types of insurance, there are other coverages that you can get for your business in Texas. If your business is located on a Texas coast, your policy will not cover damages for wind and hail. You can get insurance coverage for these from a local insurance agent.
Commercial auto insurance is also beneficial to have if your work involves frequent movement in a business-owned vehicle. A variety of vehicles can find coverage under this insurance such as cars, food trucks, service vans, emergency vehicles, and so forth.
To protect your business from unforeseen expenses, it is vital to have business insurance. There are several insurance providers in Texas who can provide you with different types of coverage. Though not all of them are required, having some amount of business insurance can save you hefty expenses in the long term. Consider getting your business insurance today.