Legal Consulting insurance – what kind and at what cost

Whenever you budget the expenses of your business, Legal Consulting insurance must be near the top of the list because you can’t always know exactly what is going to happen in the future.

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With the protection provided by insurance against accidents and all the other sorts of insurance we will tell you about, you can protect your business and yourself in case something unforeseen happens.

Like any business owner, for your Legal Consulting enterprise, you must consider how much financial liability you are taking on.

Business Insurance for Legal Consulting

If your Legal Consulting business runs without proper insurance, you are taking an enormous chance not just of losing some money but of a final wipe-out.

This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the results of their actions. 

In this article, we are giving very general guidelines for small businesses to highlight what the main kinds of insurance that you need are, and where possible, a rough guide to how much you can expect to pay.

The question is, can you afford to NOT have insurance for your Legal Consulting business?

What this means, for any Legal Consulting business owner, is that if some person claims that your work caused them some physical or economic damage, a court can award damages far beyond the total size of your business.

Your Legal Consulting business is not sheltered by laws in the same way as states are, where laws can place a “cap” on the maximum level of liability.

In some states, like Montana, there are specific monetary levels that limit the amount a court can award in any case against the state.

In a court case, it’s purely the right of the jury to award whatever amount they deem appropriate, even sometimes giving a claimant more than they have sued for.

When you are running your Legal Consulting operations, you can’t avoid responsibility for the results of your actions.

Even more importantly, unless you have spent up-front the money necessary to have your business running as a corporation, all of that liability belongs to you as an individual.

What does Legal Consulting insurance protect you from?

For your Legal Consulting business, the most important kinds of insurance are designed to cover the risks to your business from accidents, from unexpected events, and from mistakes.

In addition there are some official kinds of insurance that various states require.

In the next few paragraphs, we will outline the most important points any Legal Consulting business owner should consider when negotiating the insurance needed.

The main types of insurance for your Legal Consulting businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.

Liability insurance

General liability insurance

Any Legal Consulting business is dealing directly with other people, and that means you generally have the danger that some accident can happen to them personally or else something of theirs can be spoiled.

In such a case, they can require compensation.

General liability insurance policy for your Legal Consulting business covers you against claims coming from injury to customers or damage to their property.

It protects your Legal Consulting business from the claims themselves and also to any follow-on court costs and legal fees of the lawsuits.

In many cases, it can also help you to qualify for extra business from city and state organizations, where contracts require proper liability insurance.

The usual level of general liability insurance for your Legal Consulting business would be with a upper limit of $1 million for a single claim and a total of $2 million for the whole year.

See the table in the costing section below for average prices of general liability insurance for your Legal Consulting insurance operations.

Professional liability insurance for your Legal Consulting business

In the event where a customer alleges some negligence, errors, or omissions in how you conducted your Legal Consulting business for them, you can quickly be involved in a law suit.

Even if the matter against you is judged in your favor, the cost of defense can be substantial, and the impact on your reputation can be damaging.

Every small Legal Consulting business should have enough professional liability insurance to cover a single claim of $25,000, with annual cover of $50,000.

See the table in the cost of Legal Consulting insurance section below for average prices of professional liability insurance for your Legal Consulting operations.

Product liability insurance

Whatever goods you sell or advice you give about the goods, you are running a risk that clients may claim that what they received didn’t meet your description of function, or that your guidance was basically incorrect.

You need to know the specific laws of product liability in your own state.

For example, in California, all businesses in the supply chain can be held culpable for injuries caused by products claimed to be defective.

To cover yourself against any likely lawsuit, you need Product liability insurance for Legal Consulting

Only you can determine exactly how much insurance you should get.

Best advice is to contact experienced insurance agents, brokers or company representatives for help.

Commercial insurance

Commercial vehicle insurance for your Legal Consulting business

Be careful! – practically all policies for private vehicle insurance do not cover any happening like theft or accidental damage when the van is being used for business purposes.

The best way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a proper commercial vehicle insurance package.

Commercial van policies insure the value of any vehicle in case of accident, malicious damage, fire, or theft.

Also, in case of any accident, the van itself, the content and any legal bills, medical expenses, and property damage is covered if your truck is involved in a crash.

Most states, other than Virginia and New Hampshire, require this type of insurance.

The required value of the insurance is worked-out for the depreciated value of the vehicle, and your requested level of cover of contents. 

Tools and Equipment insurance

Since your Legal Consulting business needs specific and expensive equipment, you can appreciate how much it can cost to replace it in case of any damage, loss, or theft.

The equipment may be subject to malicious damage, deliberate fire, theft, other such unforeseen acts.

In addition, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can eliminate your whole business in one stroke.

Unless you can afford to immediately replace such specialized gear quickly out of your own pocket, you need full-level equipment insurance so that you can immediately buy any equipment needed to keep your Legal Consulting business running.

It is difficult to advise how much equipment insurance you need – it’s basically dependent on how much you have invested in your Legal Consulting business’ equipment.

Commercial Property insurance

Any Legal Consulting business that owns or rents space in a building should have a commercial property insurance policy.

If you own the space, you probably have a substantial capital investment, as well as a big liability if there’s a mortgage.

Every physical building location should carry insurance coverage for the value of the premises and contents against natural occurrences like fire and storms, and against criminal damages like theft and vandalism.

If your Legal Consulting business operates in areas of high risk, like California or Georgia, extra coverage may be needed for earthquakes and hurricanes or tornadoes.

In other states like Illinois, where extreme cold snaps can cause damage to outer coverings of Legal Consulting business premises, there is a need for more additional cover than in warmer climes.

Whereas the level of cover depends completely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of Legal Consulting insurance section below to give some idea of the average prices per million dollars of property insurance for your Legal Consulting business.

Temporary insurance by month, week or day for your Legal Consulting business

Is your Legal Consulting business working part-time or casually, or is the level of business seasonal?

Using short-term insurance makes good sense. Business insurance by the month, day, or week – temporary insurance for Legal Consulting – are special policies where you can cover a specific period when you want to be covered.

By only paying for that period of cover, you will save by having reduced premiums but still having adequate risk cover.

The key feature of short-term insurance is that you buy the cover for a defined period – a specific date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.

When you are expecting periods of higher business activity, get the existing cover increased.

Talk to your insurance agent, broker or the company’s representatives to see what options you have.

Business Owners Policy BOP for your Legal Consulting business

You have the chance to combine a few of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.

A BOP combines commercial property and public liability insurance by packaging these coverages into one insurance policy, which can save you money.

BOP insurance will cover you if any claims of injury or property damage are made.

It is often the right choice for small and medium-sized Legal Consulting businesses, such as yours.

There are some limits that will dictate whether BOP is suitable for your own business.

BOPs do not cover your professional liability or commercial vehicle cover.

Also, the size of your business will dictate whether you are permitted to take out BOP cover.

The normal business that can take out a BOP policy must have fewer than one hundred employees, and maximum five million dollars in annual turnover.

As well, you must separately take out the necessary worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your Legal Consulting business employees

In most states, it is mandatory to have workers compensation insurance when your Legal Consulting business has one or more employees.

Workers compensation insurance covers the enterprise against any costs that arise if any hired hand experiences an injury or becomes sick as a result of work.

The benefits cover medical expenses, death benefits, lost wages, and vocational rehabilitation.

Failure to meet a state’s requirements in this regard can leave you as the employer having to pay penalties levied by the states.

Some states, such as North Dakota, Ohio, Washington, West Virginia, and Wyoming only authorize coverage from the government-run monopoly state funds.

In these states, you can’t get your workers compensation obligations from private insurance corporations.

Workers compensation premiums are computed based on the employee’s pay, and usually come out at around $1.00 per $100 per month.

However, you must consult the relevant authorities in your state.

Average costs of these types of insurance

Although every Legal Consulting insurance level is unique, there are enough examples of usual quotes from insurance companies for us to give appropriate guidelines, including what are the cheapest rates offered.

Of course, you should always check with a broker what’s relevant for your business.

The list below is of annual premiums we have collected for the main types of insurance your Legal Consulting businesses needs.

Types of insurance Price range
Commercial insurance $880 – $2170
Product liability insurance $310 – $630
Public liability insurance $355 – $585
Equipment insurance $420 – $1425
Commercial vehicle insurance $1680 – $2530
General liability insurance $675 – $1175

Cost of insurance for your Legal Consulting operations depends on many different factors.

We have calculated these figures for small self-employed Legal Consulting businesses.

In larger states like California, premiums are generally about 20%-30% higher than national averages, while in smaller states like Utah, they will be about 20%-30% less.

The location and size and type of your Legal Consulting business can have a big effect on the cost of different policies.

You should talk to professional insurance agents and brokers, or insurance company representatives.

In addition you can let the internet do the work for you by looking for insurance companies near where your business is located.

Another reliable source of information is the local Better Business Bureau in your city.

FAQ

What is small business insurance for Legal Consulting operations?

This is a wide term used to describe common insurance policies designed to protect Legal Consulting business owners from risks like bodily injury, property damage, claims of negligence.

Does my Legal Consulting business have to have insurance?

Some of the kinds of insurance are not mandatory for you to run your business, but they can protect you from risks in your business operations.

Certain other forms are required by state law, such as workers compensation and vehicle insurance.

What does a small Legal Consulting business insurance policy cover?

Liability insurance provides protection against lawsuits or claims filed by a customer for bodily injury, property damage, or negligence.

The precise cover will vary based on your own operations.

See the table in the costing section above for average prices of the recommended policies for Legal Consulting insurance.

How much will Legal Consulting business insurance cost?

As well as the size of the business, some other factors, such as location and claims history, are used to determine your policy’s cost.

You should consult with professional insurance agents and brokers, or insurance company representatives.

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