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Kansas Business Insurance: Learn the Basics

Workers' Comp, Auto, General Liability Insurance & More

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Did you know that Kansas is home to 256,000 small businesses that employ almost 605,000 Kansas residents? Sounds like a pretty great place for small businesses, right? If you're a small business owner in the Sunflower State, you need to make sure you're protecting your company with the right business insurance. So in this article, we'll talk about required insurance in Kansas. We'll also cover business insurance policies you should consider to add even more protection for your business.

What Insurance is Required in Kansas?

The Kansas Insurance Department requires that all businesses carry workers' compensation insurance. The only exception is the agricultural industry, and only if the business is paying less than $20,000 a year to its employees. Likewise, it's highly advised that anyone who uses vehicles for their job (transporting patients, delivering goods, etc.) must have commercial auto insurance.

Workers' Compensation Insurance

Luckily, aside from workers' compensation, Kansas doesn't have restrictive business insurance requirements. Kansas state law only requires that all businesses with one or more employees carry workers' compensation insurance. How does it protect them? If an employee is injured or becomes ill at work, workers' compensation insurance will cover their medical bills and lost wages until they're able to return to work. Kansas businesses may also need to pay for disability insurance for all of their employees. We recommend checking with the Kansas Insurance Department for all of the legal requirements.

Commercial Auto Insurance

Commercial auto insurance is required if you use personal or company vehicles for business purposes. A commercial auto policy includes property liability coverage, bodily injury liability coverage, and covers general damages incurred during accidents.

Minimum requirements for drivers in the Sunflower State include carrying $50,000 in auto insurance coverage to pay for claims if someone is injured in an accident. It must also include $25,000 in coverage for property damage.

Types of Business Insurance in Kansas

There are a few other types of insurance that we recommend for small businesses in Kansas.

Kansas General Liability Insurance Coverage

General liability insurance (commonly referred to as business liability insurance, commercial liability insurance, or casualty insurance) isn't required in Kansas but we recommend it for all business owners. Commercial general liability insurance is great for small business owners because of how comprehensive the coverage is compared to the cost of premiums. Commercial liability insurance usually covers:

  • Third-party bodily injury: This portion of your policy covers medical expenses if someone is hurt on your property.
  • Third-party property damage: If someone's property is damaged while on or around your premises, your insurance carrier will pay to repair or replace the damaged item(s).
  • Personal and advertising injury: This will protect your business if you're accused of slander, copyright infringement, or libel. Your insurance company will provide you with a lawyer and cover legal costs if you're sued.

Example #1: General liability insurance helps pay for medical treatment if a customer falls and hits their head in your store.

Example #2: You're fixing the plumbing in a client's home and accidentally damage their kitchen cupboards while repairing their plumbing, general liability insurance can cover the cost of the damage.

Example #3: A competitor claims that your billboard ad has led to a loss of business because you made false claims about them with the ad. They slap you with a lawsuit for personal injury. Your insurance company will cover such claims by paying for a lawyer, covering court costs, and paying out settlements.

Kansas Commercial Property Insurance

Commercial property insurance (or business property insurance) is recommended for any business that owns, rents, or leases a physical business location. Property insurance will cover physical damage to your building or office space. Covered perils usually include damage by vandalism, theft, fire, and storms. This policy typically covers the contents of your building, which can include your furniture, inventory, equipment, as well as business personal property.

Most insurance companies exclude damage caused by flooding. If your business is in a flood zone, you may want to consider a separate insurance policy, otherwise, you'll have to pay for the repairs out of your own pocket.

Kansas Business Owners’ Policy

A business owners' policy (BOP) is a bundle of coverages that insurance carriers usually offer small businesses. A business owners' policy is usually cheaper than purchasing each insurance coverage separately. A standard BOP will include commercial property insurance, general liability insurance, and business interruption insurance.

Business interruption insurance is often required by lenders or property management companies. How does it work? If your business is damaged by recent storms and you can't operate, this policy helps protect you from financial loss. This can include covering payroll, paying your lease, paying taxes, and sometimes a portion of lost profits. It's usually capped at a specific length of time—or until your business is up and running again—whichever comes first.

Insurance companies may include other options in a business owner's policy that covers specific risks unique to your industry. That's why it's best to work with an experienced insurance agent in your industry to get coverage that is customized for your small business.

Home-Based Business Insurance

If you operate a home-based business, your homeowner's insurance may not cover enough of your business equipment and inventory. Many homeowner's policies cap coverage at a certain dollar amount. Plus, if you have clients coming to your home office, any accidents or injuries that occur may not be covered. We recommend checking with your insurance agent to see what your coverage is. If it isn't sufficient, speak with them about getting home-based business insurance.

Professional Liability Insurance

Professional liability insurance—i.e. errors and omissions insurance—will protect your business if you're accused of:

  • Professional negligence
  • Missing deadlines
  • Professional errors
  • Incomplete work
  • Libel or slander

Professional liability insurance will pay your defense costs for legal claims and other legal expenses that may arise. This coverage is usually recommended for lawyers, architects, healthcare professionals, and anyone that offers professional services.

Cyber Liability Insurance

Cyber liability insurance protects your business if you're the object of a cyberattack or data breach. If customer data and other information are compromised, a cyber liability policy will pay to notify impacted customers and cover the cost of credit monitoring for them.

Employment Practices Liability Insurance

Employment practices liability insurance (EPLI) protects you and your business if you're accused of discrimination, wrongful termination, sexual harassment, etc. EPLI will provide you with a legal defense if any claims arise and cover any legal costs and settlements.

Kansas Small Businesses Commonly Insured

Some professions that are commonly insured in Kansas include:

How Much Does Kansas Business Insurance Cost?

Business insurance in Kansas doesn't have to break the bank! The average cost of general liability insurance coverage for a Kansas small business average around $45 a month for between $500,000 and $1 million in coverage. However, other factors impact premium costs:

  • The industry your business is in
  • Where your business is located (city/county/neighborhood)
  • How long you've been in business and your claims history
  • The insurance company that you choose
  • The deductibles and policy limits you choose
  • The number of employees you hire

These are just a few of the factors an insurance agent will look at when assessing a small employers' needs for Kansas business insurance.

Get a Free Quote for Kansas Small Business Insurance

We know how difficult it can be to find the best commercial insurance for your Kansas business. Whether you do construction in Wichita, remodeling in Kansas City, or plumbing in Overland Park, we can find the best coverage for your specific needs.

We understand that finding the best commercial insurance for your business can be a hassle. Our goal at Tivly is to help you get the right insurance coverage at an affordable price. The process is fast and easy! Complete the form at the top of the page and someone will reach out to you. Or, give us a call at 877-907-5267.

A small business in Kansas might also want to consider these additional insurance options.

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