Having business insurance coverage is important for protecting your livelihood and your company's finances. You need to avoid making incorrect assumptions about business insurance.

The following are six assumptions you don't want to make about business insurance. 

Your home insurance can cover a business that you run out of your home.

Don't make the mistake of relying on your home insurance policy to cover business activities in your home. It's unlikely that your home insurance policy will cover you adequately for liability risks that are part of running your home-based business.

Insurance companies consider a consumer's home and business as separate, so these two entities can't really be covered effectively under one insurance policy. 

Small startups don't need business insurance.

Businesses of all sizes can benefit from carrying insurance. Even if you've just recently begun a startup venture, that doesn't mean that you don't need business insurance. Acquiring business insurance for your startup can help to ensure the longevity of your new commercial venture. 

You don't need to worry about business insurance once you've bought a policy.

Choosing and purchasing an insurance policy is an important first step in meeting your company's insurance needs. However, you need to realize that your company's insurance needs are likely to change as time goes on. That's why you need to periodically reevaluate your coverage and make any needed changes to your policy. 

You don't need to cover a vehicle used for commercial purposes through your business insurance policy.

You need to get commercial auto coverage if you use a vehicle for business activities. You're not supposed to cover a vehicle used for business activities with a personal insurance policy. Make sure you have commercial auto coverage added to your business insurance policy if vehicle usage is a regular part of your company's operations. 

Only companies with employees need business insurance.

A lot of business owners who work as sole proprietors and don't have any employees think that they don't need business insurance. While you won't need workers compensation coverage if you don't have any employees, there are still numerous other types of business insurance that you may need like business liability coverage. 

Your company can't afford business insurance.

Business insurance premiums don't have to be very expensive. Shop around and you should be able to find business coverage that your company can afford. Remember that you can write off insurance premiums as a business expense to reduce your company's tax liability.