Newcomers’ Guide to Business Insurance in Canada

What Business Insurance You Need as A Newcomer to Canada

September 18, 2023

If you are starting a business as a newcomer to Canada, you need to protect what your investment with the right business insurance.

To set yourself up for success, find out what licences and regulations apply to your type of business. Then do your research about what types of insurance your business needs as it grows.

7 top insurances that your new business needs:

1.Commercial general liability (CGL) insurance

You will also hear CGL insurance called “slip and fall” insurance. Commercial general liability insurance is essential for you as a newcomer to Canada who has started a business. That’s because it helps protect you should a customer get injured or their property get damaged at your business and you get sued.

Without commercial general liability insurance, you would be responsible for paying any legal or medical costs out of your own pocket.

This type of coverage can also help protect your business against allegations of false advertising, libel, or slander.

Typically, the minimum amount of CGL insurance is $1 million, but depending on what business you are in and how big it is, it would not be unusual to have a higher amount of CGL coverage.

Did you know that immigrants account for 33% of all business owners with paid staff? They create local jobs in all sectors of Canada’s economy such as construction, professional services, health care and retail trade.

2. Cyber Liability Insurance

It’s not just big businesses that face cybercrimes. More attacks are occurring on small and medium-sized businesses. As a new immigrant to Canada, you need to protect what you are building from cybercriminals with cyber insurance.

If your new business stores your customers’ names, addresses and credit card information digitally and your computer system is hacked, cybercriminals can sell this information.

Without cyber insurance, you will have to pay out of your pocket for the cost of restoring your system. You may also be liable for damages to third parties whose information has been stolen and you may have to pay for notification expenses to inform customers affected by a breach.

3. Professional liability insurance

This type of insurance can help protect you as an immigrant to Canada who has started a business from claims of negligence or failure to deliver a service as promised.

It’s also called errors and omissions (E&O) insurance.

You could be sued on the basis that your advice failed to fulfill its professional obligations. Professional liability insurance helps protect your business from the costs of legal action involving charges of professional negligence or failure to perform your professional duties.

Whether a claim is justified or not, defending a legal action can be financially draining for your business.

4. Commercial property insurance

Commercial property insurance covers the physical assets of your business inside and out, including your store or your warehouse, inventory, electronics, and equipment. It covers exterior fixtures such as outdoor signs or fencing.

If your business has damage or a loss, commercial property insurance will help take care of your repair and recovery costs so that you can get your business back up and running.

It’s designed to help with the repair or replacement costs for tools, equipment, inventory, electronics, and other assets that are needed to run your business.

5. Commercial Auto Insurance

Your car personal insurance doesn’t cover using your car, truck, or van for your business. You need to protect the vehicles that help power your business and deliver your products.

Commercial auto insurance will cover damage to your business vehicle if you or one of your employees gets injured in an accident and your liability to others.

It also provides replacement car coverage if you need to rent a temporary car for your business after a covered accident.

If you own 5 or more vehicles for your business, you will need fleet coverage.

6. Business interruption insurance

Business interruption insurance can mean the difference between your business closing and not reopening.

If there is an insured loss at your business that’s severe enough to prevent it from being open, the expenses typically associated with getting your business running again will be covered.

This type of policy usually covers vandalism, fire, wind, flooding, and other risks. Your policy will help compensate you for lost income and expenses that you will need to continue paying even while your business is unable to open.

7. Product liability insurance

When you sell a product, your business is at risk of product liability lawsuits.

Product liability insurance covers third-party property damages or bodily injuries caused by a product you make, sell, import, or distribute.

This type of insurance helps protect your business against legal and court costs or damages awarded against your company.

Ask about business insurance discounts

Safety discounts: Does your business have special features such as burglar alarms, sprinklers, security cameras, or a high-quality roof.
Bundling discount: Ask if you can get a discount if you bundle your home and car insurance with your business insurance.
Loyalty discount: Insurers tend to reward customers who stay with them.
Group discounts: These are discounts you can get based on your business sector.

As a newcomer to Canada who is starting a business, the right business insurance will help protect your business so that you can focus on what you do best.

At Wyatt Dowling, our business insurance experts can help you get the right business insurance at the right value for you.