Business Insurance for Veterinary Practices

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Business insurance is designed to protect a business owner's financial assets and is an essential investment for a veterinary practice.

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About General Liability Insurance

All businesses, regardless of industry, face risks that should be covered by insurance. The most common and comprehensive type of policy business owners invest in is general liability insurance (or CGL).

Some of the risks CGL insurance covers are:

  • Bodily injury
  • Property damage
  • Medical payments
  • Legal defense and judgment
  • Personal and advertising injury

While businesses aren't legally required to carry general liability insurance, operating without it is extremely risky. If your business is sued, you could end up facing fees totaling hundreds of thousands of dollars (or more). Having a sufficient CGL policy in place to help compensate for these damages is the only way to prevent this type of event from devastating your business.

Learn more about the risks covered by general liability insurance.

COMMON SITUATIONS THAT GENERAL LIABILITY INSURANCE WOULD COVER FOR A VETERINARY PRACTICE

Example 1: During a rainstorm, a customer tracks mud into your veterinary facility. Your staff doesn’t notice it until another customer walks in and falls on the slippery surface. General liability insurance would cover the costs of the resulting injury.

Example 2: One of your customers believes your practice provided poor care to their pet even though you followed all guidelines and veterinary standards. The customer is spreading their version of the story and even attempts to go to the media. General liability insurance would cover the costs to fight their claims in court and in the public eye.

Example 3: When carrying in a new piece of equipment, one of your staff members damages a customer’s car in the parking lot. General liability insurance would pay for the costs of the damage.

Of course, this is not an exhaustive list of perils a general liability insurance policy will cover, and some conditions may result in a particular peril not being covered. It's always best to talk to your agent in-depth about the specifics of your policy to avoid blind spots in coverage.

Cost of General Liability Insurance

On average, veterinary practices in America spend between $300 - $700 per year for $1 million in general liability coverage.

Check out the chart below for a snapshot of average CGL expenditure across a variety of industries:

Graph showing average price of general liability insurance prices per industry

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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Other Types of Coverage veterinary practices 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 other types of insurance all veterinary practices should obtain:

Commercial Property Insurance

Commercial property insurance covers everything on your property, including surgical tools, flower beds, and the structural integrity of the building. If you own your office and facilities, this insurance covers it against damage from everything inclement weather, theft, and fires.

Professional Liability Insurance

Professional liability insurance is available to vets in case they make a mistake while on the job. If a customer tells you that their pet has an allergy and you treat them with a medication or other product that causes a reaction, they may sue for any resulting medical costs or other damages. This insurance also covers you for any harm done by an omission of information.

Workers’ Compensation Insurance

All vet owners need workers compensation insurance for their employees, whether they work full-time or part-time. Because animals can be unpredictable in a vet’s office, this insurance is particularly crucial for employees to get the coverage they need. It also covers chronic injuries, such as long-term shoulder pain after years of lifting heavy dogs.

Business Interruption Insurance

If your business has to close for a covered reason, this insurance will provide vets with a steady income until the practice can be reopened. For example, if the practice has a fire, you’ll still receive cash flow while the building undergoes renovations.

Commercial Auto Insurance

This insurance covers vets in case they need to transport pets from one location to the next. It’s also highly recommended if you need to move equipment in a vehicle, since standard policies will typically not cover damages to work-related items.

Types of Coverage Some veterinary practices May Need

In addition to the policies outlined above, there are a few other types of coverage your veterinary practice may require depending on certain aspects of your operations. Some of these might not apply to you, so be sure to ask your agent which policies are right for your business.

Commercial Umbrella Liability Insurance

This insurance extends the coverage of your general liability policy in the case of serious lawsuits that exceed the general liability limits. Most vets will get umbrella insurance due to the emotional nature of treating people’s beloved animals. If a customer chooses to draw out a lawsuit, it can cost far more than what a general liability policy will cover. 

Data Breach Insurance

Hackers and virtual criminals of all kinds will target small businesses for any number of reasons. Because you keep so much personal and financial data about your customers on file, this insurance will cover the financial repercussions of a successful hack.

Additional Steps to Protect Your Business

Although it's easy (and essential) to invest in business insurance, it should not be your frontline defense. Yes, insurance will compensate for your business' financial losses after an incident occurs, but it's much better to avoid losses altogether.

 

With this in mind, here are three things you can do to better protect your business:

  • Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
  • Set up a limited liability company (LLC) to protect your personal assets. (Refer to our guide for step-by-step instructions on how to form an LLC in your state.)
  • Streamline your business' internal processes. This will remove unnecessary variables from common tasks and create a safe, consistent environment for conducting business.

Frequently Asked Questions

What is included in a business owner’s policy?

A typical business owner's policy includes general liability, business interruption, and 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.

What is the difference between business insurance and general liability insurance?

"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.

Do I need insurance before I start a business?

You should invest in coverage for your business before your first interaction with a customer. Although the cost of insurance may seem high for a brand new business, it's best to be proactive when it comes to protecting your assets. After all, you can't buy insurance to cover a loss that has already occurred.

Will insurance protect my business from everything?

Not necessarily. Certain exceptions may be written directly into your policy, and some perils may be entirely uninsurable. Be sure to discuss the scope of your policy in-depth with your agent to avoid being blindsided by holes in your coverage.