Buying Commercial Liability Insurance in Texas

Getting business liability insurance in Texas to protect your business assets against liability claims is still very important even if you run a new business. You can look through the Texas Department of Insurance website to find competent insurance companies providing business insurance in Texas. The website contains the contact information of these insurance companies that you can use to make inquiries about getting business liability insurance. You can also solicit the services of a Texas-licensed business insurance agent when trying to get your business liability insurance. These agents will help you assess your business and determine your insurance needs. They will then recommend the kind of insurance coverage you need to get based on that assessment. Licensed insurance agents can also offer business liability insurance from various insurers, allowing you to choose the plan that best suits your needs.

Do you Need Commercial Liability Insurance in Texas?

Yes. While Texas businesses are not required by law to get business liability insurance, getting business liability insurance in Texas is essential because it helps to reduce your business’ risk exposure, even for small business owners. Unlike workers' compensation insurance and commercial auto insurance which look to protect employees and business auto property respectively, business liability insurance protects your business against liability risks. A business owner who wants to protect their business assets, purchasing business liability insurance is crucial. This is because it covers medical and legal costs incurred as a result of damages to a customer or their property, as well as injuries sustained by staff while on duty. Asides from protecting you and your business, business liability insurance protects your customers against financial losses arising from property damages or personal injuries. For example, due to the potential increase in cyberattacks, it is essential for technology companies that hold the information of many consumers to carry cyber liability insurance in the event of a data breach.

You also need business liability insurance in Texas to secure lease contracts. Landlords are more comfortable leasing out their properties to businesses with business liability insurance policies. Having insurance coverage assures landlords that you can pay your rent even when your business is hit with liability claims. You can discuss with a licensed insurance agent the type of business liability coverage that will fit your needs.

How to Shop for Business Liability Insurance in Texas

You can buy your business liability insurance either online or through a Texas-license insurance agent. However, there are a number of steps you should take when trying to shop for your business liability insurance and they are as follows:

• Examine your business’ risk exposure:

If you are the owner of a new business and looking to purchase business liability insurance, you should always look at the kinds of risks your business is exposed to and the level of exposure. It is essential you purchase your insurance coverage in accordance with your level of risk exposure so you do not buy coverage you do not need. For example, if you own a business that offers consultancy services, you should look to get Errors and Omission insurance to protect you against liability claims for negligence.

• Compare quotes:

When shopping for your business liability insurance, try to compare multiple quotes from different insurers and choose the one that best suits your insurance needs.

• Look for a creditable insurance agent:

You can contact a Texas-licensed insurance agent to help you compare quotes and select the business liability insurance coverage that meets your needs.

• Assess your insurance policy annually:

As your business continues to grow, so will your business liability insurance needs. Consult a licensed insurance agent about what changes you should make to your insurance policy as your business continues to grow.

How to Qualify for Business Liability Insurance in Texas?

As long as you own a business, you qualify for Texas business insurance. Qualifying for business liability insurance in Texas depends on:

• The business’ industry

• The physical location of your business

• The size of the business

• The level of risks to which the business is exposed

For instance, small businesses like convenience stores may not carry as much business liability insurance as a big corporation like a multinational construction company. Contact a Texas-licensed insurance agent to discuss your eligibility for business liability insurance and the possibility of getting the insurance coverage that suits your business needs.

Where to Buy Business Liability Insurance in Texas

In Texas, business liability insurance can be purchased through a Texas-licensed commercial insurance agent. Commercial insurance agents are conversant with all business insurance policy terms, and coverages, and can quote rates from a variety of insurers in Texas, for comparison.

Where to Get Business Liability Insurance in Texas

You can get business liability insurance in Texas from licensed insurers, surplus line insurers, or through risk purchasing and retention groups:

• Licensed insurers: Business owners looking to purchase business liability coverage can do so from licensed insurers regulated by the Texas Department of Insurance (TDI). The department oversees licensed insurers’ policy forms and insurance rates

• Surplus line insurers: Surplus line insurers offer insurance covering financial losses not manageable by standard business liability insurance. You can purchase insurance coverage not offered by licensed insurers through surplus line insurers approved by the TDI. Flood insurance is one example of the type of insurance coverage offered by surplus line insurers

• Risk purchasing and retention groups: A risk purchasing group consists of businesses with comparable characteristics that face similar risks and have similar insurance needs. Upon formation and registration with the State of Texas, a risk purchasing group may use its purchasing power to get business liability insurance at subsidized rates. Risk-retention groups, however, retain risks within the group rather than purchase business liability insurance. The Federal Liability Risk Retention Act (LRRA) of 1986 regulates the formation of risk purchasing groups in Texas. Members effectively insure each other against liability claims and lawsuits

It is important to confirm if your insurance provider is licensed or registered in Texas. You can do this by contacting the TDI at (800) 252-3439 or using the TDI’s Company Lookup option.

How to Apply for Business Liability Insurance in Texas

To apply for business liability insurance in Texas, contact a licensed insurance agent to help you find business liability insurance coverage that suits your business and help you apply for it.

While applying process for commercial liability coverage, your business will be required to provide:

• Its class code and classification description;

• Its business name;

• Its mailing address;

• Description of the mode of operation; and so on.

Alternatively, you can apply for business liability insurance through risk purchasing groups. Getting insurance through these groups provides you with access to subsidized insurance premium rates. However, it is in your best interest to solicit the services of a licensed insurance professional when trying to apply for business liability insurance. A licensed insurance professional will guide you in choosing the appropriate business liability insurance policy and assist you with all the paperwork during the application process.

Who Can Help with Application for Business Liability Insurance in Texas?

In Texas, only a commercial insurance agent, licensed by the Texas Department of Insurance (TDI) can help with an application for business liability insurance. Even if you fill out the quote form online, a licensed agent is required to follow up on it, to verify provided information, and coverages, and to read legal disclaimers to you. Their services are also free so small business owners can use them.

Should I Use an Insurance Agent to Buy Business Liability Insurance in Texas?

Yes, you should use the services of a licensed commercial insurance agent when getting business liability insurance in Texas because:

• They are licensed professionals and can properly explain the complex nature of getting business liability insurance in simple terms for you to understand.

• They can help you find affordable business liability insurance coverage that meets your business needs.

• They can help you better navigate the process of applying for business liability insurance in Texas.

• They offer one-stop shopping. Instead of you comparing multiple prices from different insurers, a licensed insurance agent will bring the best options available to you.

A knowledgeable insurance agent can help you make good business liability insurance choices and get you affordable coverage.

Can you Purchase Commercial Liability Insurance Through an Agent in Texas?

Yes, in Texas business liability insurance is purchased only through a licensed agent. Unlicensed individuals cannot sell or resell insurance. If an insurance sale is made, an agent or a broker must participate.

Why Do I Need an Agent for Business Liability Insurance in Texas?

To get business liability insurance that suits your business needs in Texas, you will need an insurance agent. This is because, unlike some residential coverages, commercial insurance always necessitates speaking with a licensed insurance agent.

You will need the services of an insurance agent to:

• evaluate your company's needs;

• establish the need for coverage and what needs to be covered;

• explore locally available options; and

• present you with a list of the finest possibilities at a reasonable price.

Commercial insurance agents can also help you fill in any gaps in your business liability insurance coverage by bundling it with other commercial insurance coverages, such as workers’ compensation and commercial auto insurance, helping you lower the costs. For example, agents can help small business owners bundle multiple insurance coverages under a Business Owner’s Policy (BOP). In the event of a claim, the agent can assist you by handling the discussions between the insurer and the insured. When buying business insurance that suits your specific needs, you will need the assistance of a knowledgeable business insurance agent.

Why is an Insurance Agent Important for Business Liability Insurance in Texas?

Using the services of a Texas-licensed insurance agent when buying business insurance is vital because they have the expertise to find you an affordable and suitable policy. A competent insurance agent takes the time to learn about the unique needs of the business and quickly determines the most appropriate insurance policy for their business. Business owners may also find getting business liability insurance tedious and need a licensed insurance agent to make the process easier.

What Kind of Insurance Agents Work with Business Liability Insurance in Texas?

Business liability insurance is sold by commercial insurance agents. There are two main kinds of commercial insurance agents you can contact to help you get business liability insurance in Texas. They are:

• Independent commercial insurance agents: These agents advise on and sell business insurance policies from multiple commercial insurance providers instead of one insurance company.

• Captive commercial insurance agents: These agents work for their employer-insurer and can discuss only the products that the employer endorses.

How to Choose an Agent for Business Liability Insurance in Texas

Your personal preferences mostly determine your choice of agent for business liability insurance. You can try asking for agent recommendations from trusted friends and relatives as one method of choosing reputable commercial liability insurance agents in Texas. You can choose between captive and independent commercial liability agents. Hiring an independent agent may be more beneficial to you since they are not tied to one insurance company. You can also use the TDI lookup page to find licensed insurance agents in Texas.

Before considering them as a possibility, you can ascertain the competence of an insurance agent by:

• Ensuring they are licensed by the Texas Department of Insurance. This will help to establish their credibility and knowledge of the state's insurance market.

• Ensuring the referrer has dealt with the insurance agent and knows how the agent handles the business.

• Conducting an online review of customer comments on some Texas-based insurance agents.

• Contacting the TDI at (800) 252-3439 to inquire about the number of complaints filed against a certain agent and find out if any disciplinary actions were taken by the TDI against the agent.

How to Compare Business Liability Insurance Quotes in Texas

A business liability insurance quote is an estimate of how much you would be expected to pay for your insurance policy. Comparing business liability insurance policies in Texas could be as simple as just reviewing a quote online. However, the disadvantage of comparing quotes online is that many people do not understand the fundamental parameters to compare quotes from various insurers. As a result, they end up settling for low-cost policies that do not provide the needed coverage. Visiting the insurer's office is another way to compare business liability insurance quotes.

It is important that when comparing business liability insurance quotes, whether online or not, you should consider:

• If there is a price difference for similar coverage.

• Who and what the coverage extends to.

• The cost of deductibles per claim.

• The kind of discounts made available by the insurer.

• What the insurer's payment options are.

Ensure to consult a Texas-licensed insurance agent when comparing business liability insurance quotes.

How Many Business Liability Insurance Quotes Should I Compare?

It is advisable to compare at least three insurance quotes from different insurance providers. If you want to compare business liability insurance quotes in Texas, it is advised you consult a licensed commercial liability insurance agent. You can either get a captive or independent commercial insurance agent to help you compare insurance quotes. However, it may be more favorable to get an independent insurance agent due to them being able to get multiple insurance quotes from different insurers. Speaking to a knowledgeable independent commercial insurance agent is likely to net you the most possible options.

How Important is it to Have a Local Agent for Business Liability Insurance?

When trying to buy business liability insurance It is essential that you get the services of a licensed commercial insurance agent. A knowledgeable agent can guide you in choosing the appropriate business liability insurance coverage. There are many other reasons to get a licensed insurance agent and they are as follows:

• A local insurance agent will help you save money when purchasing business liability insurance coverage. Insurance agents will actively look for discounts and bring the best affordable rates to you.

• A local insurance agent offers extensive knowledge that could help guide you when applying for business liability insurance. They can help you understand the complicated processes involved when purchasing business liability insurance coverage.

• A local insurance agent will also help you save time when shopping for business liability insurance. They save you time by getting quotes from multiple insurance companies and bringing them to you. This way you do not have to go back and forth with various insurance companies.

Does it Cost me Extra to Use an Insurance Agent for Business Liability Insurance?

No, it does not cost you extra to use the services of an insurance agent to get business liability insurance. Depending on the kind of insurance agent you use, they will receive either a basic salary from the insurer they represent or commissions on policy sales from the insurance companies you chose from among the presented options.

How Does a Business Liability Insurance Agent Get Paid in Texas?

Commercial insurance agents in Texas are primarily compensated by the insurance companies they represent. Agents are paid by the insurers a certain percentage of the cost of the policy they successfully sell. Captive agents are paid a monthly base salary and sometimes compensated with referral commissions. An independent agent, on the other hand, does not receive a monthly salary because they work as independent contractors with multiple insurers. As a result, they only receive commissions after a successful sale is made.

Can I Buy Business Liability Insurance Coverage Online?

Yes, you can obtain business liability insurance online after comparing various quotes from different insurers. However, whether you are purchasing your insurance policy online or not, it is always important to involve a licensed insurance agent. They can assist you in comparing quotes and finding out a cost-effective policy online.

Can Anyone Get Business Liability Insurance in Texas?

Yes, anyone can get business liability insurance in Texas as long as they own a business (aka an insurable interest). However, the kind of coverage to get depends on the kind of business they operate. The following are examples of businesses and the kind of business liability insurance they are likely to need to get:

• A general contractor would likely have to purchase general liability insurance coverage. This is to protect them from financial loss arising from liability claims for bodily injury or damage to property caused by work they have done. They may also need to get professional liability insurance (Errors and Omissions insurance). This would protect them against claims of negligence or substandard work.

• A fitness trainer would most likely need to get professional liability insurance to cover injuries sustained by their clients as a result of their negligence.

• Someone who is a medical practitioner, for example, a dentist would need to get Malpractice Insurance to protect themselves (and their patients) against claims of negligence.

You can discuss your business liability insurance needs with a licensed insurance agent who can get you tailored policies that suit your business needs.

Can you Obtain Business Liability Insurance at Any Time in Texas?

Yes, business owners can obtain business liability insurance at any time in Texas. However, it is advisable to get it soon after you start your business to protect you from unforeseen liability claims, as they could happen without notice. Once the business has an active policy, a knowledgeable insurance agent verifies the coverage at least annually, to make sure that it is still adequate for the current business situation. If an adjustment is needed, the agent seamlessly handles it for you.

Is Buying Too Much Business Liability Insurance a Smart Decision?

Business liability insurance seeks to protect customers from bodily injury or property damage that has been caused by your business. For example, if a customer trips and injures themselves on the wet floor of your store, your business liability insurance policy will cover their medical bills. However, it also protects your business from financial loss occurring due to liability claims for property damage or bodily injury. You would need enough coverage to protect your business-owned cash so it is not exhausted because of a claim. Therefore, if your business has many assets, it is in your best interest to get as much business liability insurance coverage to protect those assets. Consulting with a licensed insurance professional will help you determine adequate coverage for your needs.

How Do I Renew my Business Liability Insurance in Texas?

The insured business can renew their business liability insurance policy once their insurer has notified them of the due date and the new premium amount, based on the evaluation of the previous year of coverage and the business revenues. Generally, renewing business liability insurance will follow these steps:

• Prior to the expiration of the previous coverage the insurer sends a notification to renew and requests audit documents showing how the business has performed over the year. If any claims were filed, this information must be disclosed. If some coverage amounts were tied to revenues - the audit will catch the needed adjustments. If the business underpays for coverage, it will be asked to pay the difference to make up for the shortage. If the business overpaid, it gets a credit. For the smoothest process, ask your commercial agent to oversee the renewal.

• Open your insurer’s new policy quotation and review the coverages with your agent, who helps you get the right amount of coverage to match your current business needs. The performed audit allows the agent to use real-life business revenue to evaluate the needs. The closer you are to the correct amount of coverage, the better.

• Review the policy details and the new premium rate

• Pay the new premium rate, in full or using 3rd party premium financing.

Make sure to consider the following when renewing your insurance policy:

• If the location of your business has changed

• If you have started offering a new or different type of service or product

• If you have hired more employees

• If you bought new equipment for your business

You can also discuss your business liability insurance policy renewal with the licensed insurance agent who assisted you with the application process while purchasing it.

What Kind of Business Liability Insurance is Best in Texas?

The best kind of business liability insurance for you is one that perfectly suits the kind of business you operate. For example, to protect themselves against liability claims, a business owner who owns a structural engineering business working on different projects throughout Texas would most likely need a combination of:

• General liability insurance: This would be to protect the business against liability claims for property damage, bodily injury, and advertising injury. For example, you own a hardware store and one of your items falls off an unstable shelf and injures your customer and they sue you. General liability insurance coverage will cover the medical bills of the client and cover the financial loss that may arise from the liability claim.

• Errors and Omission insurance: covers financial loss caused by any error or omission in the course of commercial activities. For example, a structural engineer makes an error or omits a necessary process during construction and it causes an accident that leads to injury and is sued for negligence. Professional liability will cover the damages caused by that incident and legal expenses incurred by the liability claim for negligence.

• Commercial umbrella insurance: This is for extra coverage. It provides coverage risks not covered under your initial business liability insurance policy.

Speaking with a licensed insurance agent can help you determine the best business liability insurance policy for your business.

What Kind of Business Liability Insurance Plans are Available in Texas?

There are various business liability insurance plans in Texas, depending on the business type. Factors such as the size of the business and its location significantly determine the kind of coverage you should get. Liability insurance is meant to protect both the “others” from the actions and damage caused by the insured business and the business itself, from having to spend the company's cash reserves on litigation and paying the damages. Examples:

• An owner of a dental clinic would likely need general liability insurance and professional liability (Medical Malpractice) insurance to protect them from financial loss arising from personal injury to a patient.

• General liability insurance is to protect businesses from financial loss arising from liability claims for bodily injury and property damage claims caused in the course of business activities. It also covers clients who have suffered some form of injury as a result of the business. The number of liability risks a business faces may affect its general liability insurance cost.

• Professional liability covers the dentist against liability claims for negligence. It essentially protects the dentist against financial loss if he were to be sued for a mistake, due to negligence, during a procedure.

• General contractors would normally carry general liability insurance to offer financial protection against liability claims due to the effects services they offer and the products they use on the client. The most common general liability claims in Texas are:

• Property damage - where work carried out by a general contractor leads to property damage.

• Accidental injuries - where work done by a general contractor allows the client or any other person to sustain bodily injury.

• Airline pilots would need to get pilot liability insurance to protect themselves against liability claims for negligence, property damage, and bodily injury.

• Professional consultants (including licensed professionals, such as consultants, real estate agents, insurance agents, and investment advisors) would need to get professional liability insurance, especially Errors and Omissions insurance, to cover against liability claims for negligence and subpar work. The most common professional liability claims in Texas are:

• Breach of contract - where a client suffers damage, such as financial loss, due to a breach of contract.

• Negligence - this is when a client suffers damage due to the negligence of a professional consultant.

• Fraud - this is where a client suffers damage due to the fraudulent practices of a professional.

• Legal professionals likewise usually carry professional liability insurance, specifically Errors and Omissions insurance to provide coverage against claims for negligence and poor work.

• Product manufacturers (large corporations and artisan shops alike) need product liability coverage, to protect their consumers from faulty products and damages they may cause. The most common product liability claims in Texas are:

• Design defects - where the injury is caused by the design

• Manufacturer defects - where the products’ problem was caused during the manufacturing process, and

• Failure to warn - when the manufacturer fails to apply the required disclosures, failing to warn the consumer of the possible dangers, precautions, or pitfalls.

How to Reinstate Business Liability Insurance that you Stopped Paying

An insurance company will often cancel a business liability insurance policy if the insured business fails to pay outstanding premiums after a grace period. Once an insurer cancels a policy, the business loses coverage. To reinstate such a policy, the business owner must contact the insurer or their insurance agent to understand the process and the documents to provide. Usually, the insured business may be asked to make payments covering any missing premiums and the accrued interests.

How to Find Out What Business Liability Insurance I Have in Texas

You can carefully peruse your business liability insurance policy document to know the kind of coverage you have. The fine print usually spells out all of the policy's pre-set conditions. You can also engage your licensed insurance agent to find out the type of business liability insurance coverage you have.

Is Business Liability Insurance a Good Deal in Texas?

Yes, having business liability insurance in Texas is a good deal if you own a business. In fact, it is one of the most important coverages for any business. Commercial liability insurance is suitable for those who want to protect their business from financial loss arising from liability claims for bodily injury or property damages. It is a good deal when you consider the amount of money your business would pay out of pocket if it suffered a large liability loss without the right coverage in place. Speak with a licensed insurance agent to find an affordable and suitable business liability insurance policy for your business.