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Ask The Expert: Business Insurance

We’re back with another edition of Ask the Expert! This new blog series aims to answer the most common questions that we receive from new or prospective entrepreneurs.

We’re back with another edition of Ask the Expert! This new blog series aims to answer the most common questions that we receive from new or prospective entrepreneurs. On today’s edition, we feature Danish Yusuf, CEO and Founder of Zensurance.

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Insurance is a critical component of a business’s ecology. We often hear new business owners and entrepreneurs ask questions about what kind of business insurance they need, how much it costs, and how to get insured. So we asked Danish what are the five most common questions you hear regarding business insurance?

In this blog post:

  • 1: What is Business Insurance, and do I really need it for my business?
  • 2: What does business insurance cover?
  • 3: How much does business insurance cost?
  • 4: How do I get business insurance?
  • 5: How often should I revise my business insurance policy?


In a sense, it is up to you – but keep in mind the implications of operating without a safety net. Even if nothing goes wrong, there will always be the biting nervous feeling that something unexpected may happen. At the same time, your employees and customers expect there to be protection and it may get a little awkward explaining why you don’t have any.

Business insurance is designed to safeguard not only the obvious assets of your company – its property – but also the mobility, scale and stability of your business operation.

I’ve listed some of the bell-ringing reasons for insurance, but the list really does go on and on. You are risking EVERYTHING without insuring your business.

Take for instance Peter Pumpkineater, who has a plumbing company (how original, I know). One of his green, inexperienced employees slips up and turns a kitchen sink into a kitchen geyser, destroying the main-level flooring, and flooding the entire basement of a million-dollar home until it resembles a well furnished aquarium.

If Peter has proper business insurance coverage, his burgeoning plumbing business will continue basking in the sun. If not, then he may be held liable to pay for all damages and legal fees – which may sink his business right next to the soaking sofa at the bottom of the aquarium.


Business insurance is actually an umbrella term that refers to many, more specific insurance policies. If your small business is just starting out, you’ll want to consider these common insurance policies:

  1. General Liability Insurance: This protects you from third-party injuries and damages that your business may have caused or is alleged to be responsible for. For any business that deals with customers face-to-face or have a physical location, this is a must have coverage.
  1. Professional Liability Insurance (Errors and Omissions): There’s always the possibility that a professional service can generate negative consequences like failure to deliver, negligence, or misconduct. For instance – financial advice that flushes a client’s savings down the toilet. (Sounds like a job for Peter the plumber)

Any service professionals such as consultants, lawyers, and therapists can find themselves in a similar situation.

  1. Commercial Property Insurance: This protects your property and belongings in the event of natural or unnatural damages – think fires, floods, vandalism, and larceny.
  1. Product Liability Insurance: If bodily harm or property damage can be traced back to your product in any way, your business may be held responsible. This could be the result of product or design defects, or even an improper label. This insurance policy can help save time and money if you must deal with legal repercussions that result from the products you sell.
  1. Cyber Liability Insurance: For businesses that store personal information of their clients on any business networks are at risk of cyber attacks.  This policy covers legal expenses from third-party lawsuits against your business that had resulted from cyber breach incidents.

Depending on how your business operates, there may be additional coverage required. For businesses that deal with transportation, there’s commercial auto insurance. If you have employees on the payroll, there’s Workers’ Compensation (WSIB in Ontario). If you deal in exotic animals (for whatever reason), there’s probably an insurance policy for that.


The answer here depends on your business. If you are spearheading offshore drilling consultation, you can imagine the massive liabilities involved, compared to operating an Etsy page that sells healing crystals. The size of your business and the associated risks are paramount in assessing your insurance costs. On average, your typical low-risk small business can expect to pay around $500-750/year for a basic general liability insurance policy, which is the most common policy to begin with.

      Some factors that affect your insurance costs:

  • Associated risks of products and services
  • Industry experience
  • Prior insurance claims
  • Revenue earned each year
  • Number of employees


You’ll want to inform yourself (which you’ve been doing great at). Consult with an insurance broker – maybe a few of them to compare rates. For the busy small business owner, this process can be time consuming, but thanks to digital advancements in insurance technology you can receive an online quote in a matter of minutes. These suggestions will help smooth out your insurance buying process:

  1. Brainstorm your vulnerabilities

To get your head around what kind of insurance you will be applying for, you will be asked about your business’s vulnerabilities. Where is your business exposed to risks? Is there any way you can reduce these risks?

Tip: Do some research on the common insurance claims in your industry, or consult with an expert

  1. What is your worst case scenario?

This will give you an idea of where to set your policy limit: the maximum amount of payout from your insurance company. Most insurance policies have a limit of $1M or $2M. So what is the worst that could happen, and how much loss would your business suffer?

  1. Have your active insurance policies nearby

If you already have insurance coverage, look at your current policy limits to see if there’s too little or too much for your business.  There could also be opportunities to save by combining your existing insurance with the insurance you’re shopping for.

  1. Important review

When you have found the Cinderella insurance policy (the perfect fit), make sure that the major vulnerabilities are protected. All insurance policies have an exclusion list, so make sure you understand what is on this list. If a huge business risk is left defenseless because it’s excluded from the policy – I mean, what’s the point?


There’s no standard interval of time where policy revisions are made, but insurance policies tend to be annual contracts, so a yearly risk review is a fair process. However, there are certain events that can inflate or change your risk factors.

  • New products or services
  • Change in company ownership
  • Relocation of your business
  • Drastic changes in your income

The process of insuring your business is super easy these days. Just make sure you take the time to make a mindful decision.

Thank-you to Danish Yusuf for generously donating his time and providing valued insight. Stay tuned for the next edition of Ask the Expert, and subscribe to our newsletter here so you can stay up to date on the latest posts!

Did this inspire you to launch your own business, or jump start your existing one? Book a free one-on-one consultation with a YSBEC consultant today!