Posted on May 17, 2014
Many small businesses and organizations make their home in Wyoming due to the business friendly environment that is essentially free of all taxes - no personal income, corporate income, personal property, real estate transfer or gross receipt taxes whatsoever. Free of many regulations to open a business, this climate encourages continued growth and increased profits for new startups and existing businesses alike.
In order to manage the burden of potential lawsuits and liability claims, businesses can protect their assets by having the right commercial insurance policies in place. While every company needs to have property and general liability insurance, the State of Wyoming only requires that certain businesses carry workers compensation insurance. Read on to learn more about commercial insurance requirements in Wyoming.
Wyoming Liability Coverage
With all the time and resources business owners put into building their companies, it only stands to reason that protecting those efforts with general liability insurance makes the most sense. Accidents are commonplace and for the most part unavoidable. But when they do occur, companies take on the risk that someone may sue, resulting in legal fees and potential damage awards from that lawsuit. General liability insurance serves to help assist with paying legal defense fees and potential awards.
Choosing the amount of coverage for liability policies requires an understanding of the amount of risk involved with the type of business being insured. Some industries are more hazardous than others and will require significantly higher amounts of insurance than those with less potential for accidents. Generally, liability policies will cover bodily injury, property damage and advertising injury with each business owner choosing the coverage that is the best fit for his or her company.
Workers Compensation Coverage
Wyoming law requires that businesses "involved in extra hazardous employment" with more than one employee must purchase workers compensation insurance. The state's definition includes a variety of businesses in the extra hazard category including restaurants, bakeries, hotel operations and more. So for the most part, all employers are subject to Wyoming workers' comp requirements.
Additionally, companies must create their account with the state owned Workers' Safety and Compensation Division of the Wyoming Department of Workforce Services. Those companies not required to participate in the workers' comp system can choose to cover their workers if they desire. When workers comp accounts are opened, businesses may also register for their unemployment compensation insurance at the same time, since the same department administers both programs.
Any company not complying with Wyoming workers compensation requirements opens themselves up to potential lawsuits with unlimited liability and penalties.
When damage occurs to equipment whether because of a power surge, computer virus or even fire sprinklers turning on by accident inside an office building, commercial property insurance provides the needed coverage to pay for business property that is damaged or destroyed. Companies would have a hard time staying open with damaged inventory or office equipment, and so property insurance gives business owners added peace of mind should an accident happen.
Commercial property policies provide coverage for business buildings, contents and as property that belongs to others. So for instance, if a computer repair shop had client laptops on premises for repair and a fire occurs, the policy would protect the owners of the shop by covering the loss of the laptops.
For businesses who do not own their buildings, property insurance can also include coverage for any tenant improvements, fixtures and inventory. Several policy endorsements are available for business owners to customize their policies to fit their particular needs. Examples of added endorsements are coverage for outdoor property, spoilage and personal effects.
Commercial Flood Insurance
Because flooding is not included in homeowner or business insurance policies, many business owners may not be aware of the need to purchase flood insurance. Wyoming is particularly affected by heavy spring and summer runoff water that can cause flood damage in certain areas. Flood insurance policies are available from licensed Wyoming agents as well as the National Flood Insurance Program. Flood policies typically pay for direct physical damage using replacement cost or actual cast value up to the policy limits of coverage. Because there is a 30-day waiting period for this policy to become effective, it is important for Wyoming businesses to apply for coverage prior to the rain and snowmelt seasons.
Tornado & Fire Coverage for Wyoming
Weather related property damage is common in the state of Wyoming. Not all commercial property insurance policies cover tornado and fire damage. Business owners need to check their policies to make sure that they have coverage, particularly those residing in southeast Wyoming where these types of weather events are common. Your insurance broker or agent can add endorsements for these perils or offer separate policies to ensure that your business is covered for these conditions.
Additional Information on Wyoming Insurance
Visit the State of Wyoming Insurance Department website at http://insurance.state.wy.us or give them a call to learn more (307) 777-7401.