The most common starting point for business insurance is General Liability insurance.

Business insurance is basically what helps keep your business from getting wiped out by one bad day. And businesses have bad days sometimes. A customer slips, an employee gets hurt, a fire damages your equipment, somebody claims you messed up a job, a storm floods your building, your van gets in an accident, or a hacker locks up your computer files and wants money. None of that is fun to think about, which is why a lot of small business owners put insurance off. But insurance is really about survival. It’s not about expecting disaster every week, it’s about knowing that if something big happens, you’re not personally ruined and your business can keep going.

A lot of people hear “business insurance” and think it’s one single policy. Like you buy “the insurance” and you’re good. But business insurance is more like a menu. Different types of businesses face different risks, so there are different policies that cover different things. Some are optional, some are required by law, and some are required by clients or landlords. The right setup depends on what you do and how you operate.

So when do you need business insurance? Honestly, sooner than most people think. If you’re making money, dealing with customers, signing contracts, owning equipment, renting a space, hiring workers, or driving for business, you probably need at least basic coverage. Even if you’re home-based, you can still have liability risks. People think “I’m small, nobody will sue me.” But small businesses get sued all the time because accidents and misunderstandings happen, and sometimes people are just looking for someone to pay. And even if you did nothing wrong, defending a claim can cost a lot. Legal fees are a real thing.

The most common starting point for business insurance is General Liability insurance. This covers claims where someone says your business caused bodily injury, property damage, or personal/advertising injury. For example, a customer trips in your store and breaks an ankle. Or you’re a contractor and you accidentally damage a client’s kitchen. Or you’re accused of using someone’s copyrighted photo in an ad. General liability can cover legal defense and settlements up to your policy limits. It’s one of the most basic policies because it covers common “oops” situations that happen in day-to-day business.