There are thousands of businesses based in Alaska. Some are large, multi-million dollar companies like AT&T Alascom, while most are small, privately-owned businesses like Bailey’s Furniture. Whether your company is a Fortune-500 company that employs thousands of people, or a sole proprietorship, a commercial insurance policy may be necessary to protect the investment of time and money you have made in establishing it. If you are considering purchasing insurance to cover your business in Alaska, the first step is to start comparing commercial insurance policies and quotes.
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Revenues Generated by AK-based Businesses
- Manufacturers’ shipments: $8.20 billion
- Merchant wholesaler sales: $4.56 billion
- Accommodation and food service sales: $1.85 billion
- Retail sales: $9.30 billion
- Retail sales per capita: $13,635
Whatever industry your Alaska-based business operates in, there is a business insurance policy that is right for you. These commercial policies are designed to be fully customizable so that they can meet the diverse needs of different types of businesses.
Is a Business Insurance Policy Mandatory in AK?
You are not required by law to have a business insurance policy, but some components of the coverage may be required under certain circumstances. In such cases, you can choose to either purchase the required coverage separately, or to include it as part of your commercial insurance plan. You will need to carry insurance if:
- Your business has employees: If your business has employees, you will need to purchase workers' compensation and disability insurance to cover them in the event that they are injured or become disabled while in your employ. In addition, if you have at least 50 full-time employees, you will need to provide them with affordable healthcare coverage.
- You rely on company-owned vehicles: If your business has company-owned cars or trucks, they will need to be covered by a commercial vehicle insurance policy. In many cases, you can include this coverage as an option in your business insurance policy or, if you prefer, you can purchase it separately.
- You have taken out a business loan or mortgage: In many cases, lenders will require you to have a business insurance policy in place for the duration of your loan. This is because business insurance can prevent many of the financial problems that might cause you to default on your payments.
- You rent the space in which your business is housed: It is possible that your landlord has included a requirement that you carry business insurance as one of the terms of your lease. Be sure that you have reviewed the obligations you have agreed to when you signed your lease agreement.
- You have a home-based business: In this case, your homeowners insurance will likely cover a small portion of your losses if your business suffers a loss due to damage to your home. However, many insurance companies require owners of at-home businesses to purchase an additional rider to be eligible for compensation for losses to their business equipment or property.
- You serve or sell alcoholic beverages: Your business can be held liable for the actions of others if they are intoxicated after being served in your establishment, or if they are intoxicated while under the age of 21 and have purchased alcohol from your business. Liquor liability insurance is therefore required by the state of Alaska for businesses that serve or sell alcoholic beverages.
Whether or not a business insurance policy is required, commercial insurance is the best way to protect the investment you have made in your business.
Alaska Business Statistics
- In 2010, there were 69,746 businesses based in Alaska. Of these:
- 15,893 were businesses with one through 500 employees
- 569 were businesses with more than 500 employees
- 53,284 were businesses with no employees (self-employed individuals)
- Businesses with fewer than 500 employees employ 53.1% of this state’s private-sector labor force
- The 2007 US Census shows how minority-owned businesses in AK compare to the rest of the country
- Percentage of firms owned by women
- National statistics: 28.8%
- Alaska statistics: 25.9%
- Percentage of firms owned by African-Americans
- National statistics: 7.1%
- Alaska statistics: 1.5%
- Percentage of firms owned by Asian-Americans
- National statistics: 5.7%
- Alaska statistics: 3.1%
- Percentage of firms owned by American-Indians and Native-Alaskans
- National statistics: 0.9%
- Alaska statistics: 10.0%
- In 2010, 4,466 new businesses were established in AK
- In that same year, 58 of Alaska’s small businesses filed for bankruptcy
What Does Commercial Insurance Cover in Alaska?
Business insurance policies have many different coverage options. This enables business owners to purchase fully-customized policies designed specifically to meet their companies’ unique coverage needs. The main coverage categories offered by these plans are liability, property and income insurance.
- Liability insurance: There are many different types of liability insurance that can be purchased with a commercial policy. You can opt to purchase only the liability coverage types that are relevant to your particular company. Some of the most commonly purchase liability coverage options are:
- General liability
- Professional liability
- Product liability
- Liquor liability
- Commercial vehicle liability
- Non-owned, or for-hire vehicle coverage
- Property coverage: Your business property might be damaged in disasters such as fires, extreme weather events or because of property crimes. Be sure that you have sufficient coverage against these problems. You can purchase coverage for such things as:
- Your business’s materials, merchandise and inventory
- Computers and other electronics used in your place of business
- Furniture, flooring, carpeting and décor
- Outdoor signs
- Glass in your windows and display cases
- Commercial vehicles
- Continuation of income coverage: This is also known as lost income coverage. It provides your business with an income sufficient to meet your monthly expenses and pay employee salaries if your company is forced to temporarily halt operations as the result of a covered event. This coverage is typically good for up to twelve months.
Business Insurance Does Not Cover Flood and Earthquakes
It is important that business owners in Alaska are aware that, like homeowners insurance, business insurance policies do not cover you against flood or earthquake damage. For this reason, you may want to consider supplementing your policy with a government-backed flood insurance policy through the National Flood Insurance Program (NFIP) or with an earthquake insurance policy rider.
Business owners can purchase flood coverage in amounts up to $500,000 in building coverage and $500,000 in contents coverage through the NFIP. Earthquake insurance policies have fewer coverage limit restrictions.
Easily Compare Business Insurance Quotes in Alaska
Purchasing a suitable business insurance policy requires a bit of foresight and practicality. Be sure to consider all the possible risks that your Alaska-based company may face so that you can properly shield it from undue financial losses. An independent insurance agent in the Trusted Choice® network can help you build the right policy by answering your insurance-related questions and helping you determine your coverage needs. These agents can also work with a number of different insurers to provide you with a selection of commercial insurance quotes to compare.
There are several Trusted Choice agents with offices in Alaska so it should be easy to find one near your home or business. Contact a local agent to get more information and you can soon begin comparing business insurance policies and quotes.