Is Commercial Insurance Required in California?

If you own a small business in California, you’ll want to stay informed on any changes in state law regarding insurance requirements. Currently, California mandates that businesses have two types of insurance at all times – workers’ compensation and commercial auto insurance. The first type, workers’ compensation insurance, is required for businesses with any employees and helps pay for the medical bills and lost wages associated with a workplace injury or illness. The second type, commercial auto insurance, is needed for any business-owned vehicle. Additionally, if employees use personal vehicles for work, it is highly recommended that hired and non-owned policies be purchased because most personal auto policies exclude business use. 

While none of the following insurance is required for your business, they are highly recommended as they provide additional coverage should an incident requiring insurance occur. 

  • Cyber Liability Insurance: If your business suffers a cyber-attack, this insurance can be used to cover the cost of notifying impacted customers, regulatory fines, extortion payments, and legal fees.
  • Professional Liability Insurance: Covers the legal costs associated with a breach of contract, negligence, and other similar claims made by a customer.
  • Crime Insurance: If your business is the victim of a theft or robbery, this coverage can help you recover from these losses.
  • Business Income Insurance: Should your business be forced to close, this coverage contributes to paying rent and other bills.
  • Commercial Umbrella Insurance: Provides excess liability coverage beyond your existing policy limits. 

Call Biddle-Shaw Insurance Services Inc. in San Francisco, CA for more information on insuring your business. Our friendly and knowledgeable team of insurance professionals are happy to answer all your questions and can help customize a commercial insurance policy that best protects your business.