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10 Steps to Starting a Small Business in 2022 – Step 10: Get Business Insurance

Posted by Jonathan Krems | Mar 11, 2022 | 0 Comments

Last week in the Freedom Friday blog and email newsletter we continued the series, “10 Steps to Starting a Small Business in 2022,” and we covered the ninth step, which is to choose an audience or location.  In today's Freedom Friday blog and email newsletter, we're going to talk about the tenth step.  Once you have developed a business plan, gathered your team, chosen your entity, created your operating agreement or bylaws, applied for your EIN, opened at least one business bank account, applied for licenses and permits, found financing or funding, and chosen an audience or location, the tenth step is to get business insurance.

As a small business owner, you've made quite an investment in your small business.  You've developed a business plan, gathered your team, formed a business entity, obtained your EIN, opened bank accounts, obtained licenses and permits, found financing or funding, and chosen a location and/or target audience for a great product or service which your small business will offer.  All of this is essential, but it is critical to protect your investment and your small business through getting business insurance.  There are four different types of insurance which you should consider getting for your small business.

  1. Commercial General Liability Insurance

The first type of insurance you should consider for your small business is commercial general liability insurance.  This is an insurance policy that will protect your small business from a wide variety of risks.  It is a cost-efficient and effective way to keep your small business safe from unexpected costs from lawsuits, accidents, or other actions taken against your small business.  Commercial general liability insurance will protect your small business if someone is injured on your business's property and will cover damage caused by you or your employees in some instances.  When evaluating these types of insurance policies, you should be more concerned with obtaining good coverage rather than cost.  A cheaper policy may expose you to greater risk.  You should also make sure you understand the policy limits, premiums, deductibles, and exclusions.  Also, always consider the reputation of the insurance provider, and make sure they're a licensed insurer.

  1. Workers' Compensation Insurance

The second type of insurance you should consider for your small business is workers' compensation insurance.  In Oklahoma, workers' compensation insurance is required if you have any employees.  Workers' compensation insurance is a type of policy designed to cover an employee's medical needs due to a work-related injury.  Workers' compensation insurance will provide financial assistance to injured employees, protect your company in the event of a lawsuit, and minimize the risk of employee lawsuits.

  1. Professional Liability Insurance

The third type of insurance you should consider for your small business is professional liability insurance, also known as errors and omissions (E & O) coverage.  This is for small businesses which offer professional consulting or advisory services, such as attorneys, accountants, architects, and many other professional occupations.  Professional liability insurance protects against claims of inaccurate, negligent, or undelivered work.  If you or an employee make a mistake that costs your client money, your client could sue to recover their losses.  Professional liability insurance will cover your legal fees for alleged inaccurate work.  If the work you provide does not live up to standards of quality set by state law, industry norms, or contractual obligations, your client could sue for negligence, and professional liability insurance can cover claims arising from that alleged negligence.  Contracts for professional services can also have clauses regarding effects on the client's business after the work is completed.  If a certain level of sales or profit isn't reached, the client could sue your small business for undelivered or underdelivered results, and professional liability insurance can cover those claims.

  1. Business Interruption Insurance

The fourth type of insurance you should consider for your small business is business interruption insurance.  Business interruption insurance provides coverage for when your small business operations are interrupted by unforeseen circumstances, such as damage to your business's property, or a personal injury to the small business owner.  When you're evaluating business interruption insurance policies, you should consider the unique risks your small business faces, based on your location and industry.  Not all business interruptions will be covered.  You also need to consider the time it will take to get your small business going after the interruption is over, and make sure the policy will cover your small business for an appropriate amount of time.  Lastly, online businesses are susceptible to cyber security breaches, and so if you own an online business, you need to make sure the business interruption policy will cover such cyber incidents.

If you're interested in starting a small business in 2022, or you have any business law or business litigation needs anywhere in the State of Oklahoma, please contact me at [email protected] to schedule a FREE strategy session.

For more information about Liberty Legal Solutions, LLC, please visit our website at

About the Author

Jonathan Krems

Jonathan is the Founder and Managing Attorney of Liberty Legal Solutions, LLC, a law firm dedicated to building, protecting, and defending the business and personal interests of our clients in Oklahoma.  Jonathan's primary practice areas are business law, contracts and agreements, business liti...


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