Currency Trading Business Insurance
Getting insurance for your currency trading business is essential.
Currency trading businesses, like all businesses, face a number of potential financial liabilities from which they need protection, such as breach-of-contract claims and personal injury lawsuits.
For example, someone could claim that you defrauded them in a financial transaction.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Currency Trading Business
General liability insurance is — generally speaking — one of the most important insurance policies for currency trading businesses.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
General liability insurance is important for your currency trading business to have, but there are things it doesn’t cover. For more complete protection, we recommend purchasing other types of insurance as well, such as:
- Commercial umbrella insurance
- Commercial property insurance
- Product liability insurance
- Workers’ compensation insurance
Most companies that offer business insurance fall into one of two categories: traditional insurers and online insurers. Traditional insurers have physical offices and employ agents to sell policies. They tend to be large, well-established companies like The Hartford, and they offer high-quality insurance.
Online insurers, by contrast, sell policies on their websites using AI rather than agents. This means they have less overhead, and thus they’re often much cheaper, especially if you want a highly customized policy. We recommend online insurers for most small businesses, as you get a lot more for your money.
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Cost of General Liability Insurance
On average, currency traders in America spend between $400 - $700 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a currency trading business to other professional industries using the graph below.
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Common Situations That General Liability Insurance May Cover for a Currency Trading Business
Example 1: While trading currency, your company profits heavily from a glitch in the global software system you’re using. Later, your company is accused of fraud or unfair practices. General liability would likely help cover the costs of defending yourself against the charges.
Example 2: A friend comes to your office to meet you for lunch. While entering, he slips and falls on a floor that wasn’t properly cleaned, and he blames your company for his injuries. General liability would likely cover the resulting injuries in the case of a lawsuit.
Example 3: A currency trading company in a different country claims that your business name is too similar to their own. This similarity is causing confusion on the global market, and they feel they’re losing business. General liability insurance would likely help cover the costs of settling the matter.
Other Types of Coverage Currency Trading Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Commercial Property Insurance
Commercial property insurance protects you from the cost of repairing or replacing owned real estate, equipment, and supplies. If you’re investing money in complex and powerful equipment, this insurance can also stave off heavy losses from theft or unexpected emergencies.
Business Interruption Insurance
Currency traders can be heavily influenced by global events and even local affairs. If your business is halted by an event outside your control, you may be able to file a claim for business interruption insurance. This insurance will help you recoup any lost income so you can continue to pay your expenses.
Commercial Umbrella Insurance
A lot of unexpected events can occur in the complicated world of currency trading. Owners may not even realize that certain factors were threats to their business until they occur. Commercial umbrella insurance is designed to kick in when your general liability policy’s limits are reached, such as in the event of a costly lawsuit.
Professional Liability Insurance
Currency traders sometimes lose money on trades, which is why professional liability insurance may come in handy. This form of insurance can protect your business against lawsuits seeking compensation for losses that came as a result of negligence or errors.
Home-Based Business Insurance
If you work from home, certain work-related accidents and injuries may not be covered by your homeowner’s policy. This insurance gives business owners the means to cover their property and business should something happen while they’re working from home.
Data-Breach Insurance
Every company with a computer has to worry about data breaches, but currency traders may have additional cause for concern. This form of insurance will provide coverage if you lose sensitive electronic data in a hack.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your currency trading business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Currency Trading Business Insurance FAQ
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
In general, you should purchase business insurance for your currency trading business before conducting your first transaction. It’s not a good idea to operate a business without financial protection from lawsuits and other risks.
Also, your state may require some types of business insurance, such as commercial auto or workers’ compensation.
Not necessarily. Certain exceptions may be written directly into your currency trading business insurance policy, and some perils may be entirely uninsurable.
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.