In Tennessee, a small business includes any company that has fewer than 500 employees. Small businesses are vital for all states’ economic well-being. In the state of Tennessee, according to in 2008, the latest data available there were 552,653 small businesses, 99,339 of which were small employers, accounting for 45% of the state’s private-sector jobs.
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What is commercial insurance?
Commercial insurance, also referred to as business insurance, is an insurance policy that protects a business owner and the employees from any problems that could affect the business, any unforeseen events/risks that could interrupt a business. Such as injury risks.
Tennessee commercial insurance requirements
There are two types of mandatory commercial insurance in Tennessee, and they are:
Worker’s Compensation Insurance:
This insurance covers medical expenses and lost wages as the employees recuperate from an illness or injury. This coverage in fact is required by law, so business owners who have workers comp even if they have only one employee. The primary purpose of this insurance policy is to protect your employees against any financial losses if they are ill or suffer injuries in your workplace.
Workers’ comp is under a no-fault system; therefore, an employee doesn’t have to prove that the illness or accident was someone else’s fault, the employee will just be compensated for any injuries or illnesses sustained on the job. Employers looking for worker’s compensation insurance have these options:
- Self-insure: using an experienced insurance broker to purchase workers comp from a reputable insurance company.
- Sourcing via the State Compensation Insurance Fund (also known as State Fund): The State Fund will provide you with a reasonable workers comp, thus helping you save money.
Commercial auto insurance
The Business Auto Coverage Form (BACF) is the standard insurance form that almost all insurance companies provide commercial auto coverage. The document clearly states “autos” to include cars, trucks, vans, trailers, or other vehicles. Tennessee’s minimum commercial auto insurance requirements are:
- $25,000 bodily injury liability per person
- $50,000 bodily injury liability per accident
- $15,000 property damage liability per accident
How much does commercial insurance cost in Tennessee?
Unfortunately, we cannot give you a straight answer because there many that can impact the amount you will have to spend on commercial insurance. These factors that are listed below can vary from business to business.
- Industry
Evidently, some industries have higher risks than others. Since insurance companies invest on you based on your business’ risk profile, you may find your insurance rates reflect increased risk that comes with your industry.
- Number of Employees
It is a law required everywhere that if you have even one employee you must provide them with insurance, and naturally in this circumstance, the more employees you have the more you have to pay for your small business insurance.
- Payroll
Your business’ payroll also plays an important role in how much you will have to pay for insurance.
- Claims History
A business with a clean claim history, just like any other policy, means safety and experience which ultimately result in a lower insurance cost.
