Counseling Center Business Insurance
Getting insurance for your counseling center is essential.
Counseling centers need to be protected against things like malpractice, improper diagnosis, and breaches of confidentiality.
For example, a counselor provides a patient with improper advice that resulted in them experiencing mental anguish, or an employee accidentally leaks sensitive customer information.
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 Counseling Center
General liability insurance is — generally speaking — one of the most important insurance policies for counseling centers.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
It’s worth investing in several additional policies for your counseling center in order to supplement the protection of general liability. Some great policies to consider include:
- Workers’ compensation insurance
- Professional liability insurance
- Commercial umbrella insurance
When purchasing coverage for your center, it is important to bear in mind the key differences between the two general types of insurers:
- Traditional brick-and-mortar insurers — Includes providers that employ insurance agents and rent out physical spaces such as offices and storefronts. While these providers are typically well-respected and trusted, due to the aforementioned costs, their policies are typically more pricey.
- Online insurers — Includes providers that run their business almost entirely online. As such, their policies are far more competitively priced since they have far fewer overheads to worry about. By utilizing AI technology, they are also able to match the quality of traditional insurers.
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Cost of General Liability Insurance
The average counseling center in America spends between $450-$1,500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a counseling center 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 Counseling Center
Example 1: You have removed the old floor but have not installed the new flooring yet. The client tries to enter the property and falls due to uneven footing. They file a legal claim against your business. Your general liability policy will cover your legal defense costs, including the cost of a settlement if the case is decided out of court.
Example 2: One of your employees loses control of a dolly while moving tiles from a truck to the property. The heavy boxes of tiles fall on the client’s elaborate landscaping, smashing lighting installations and exotic plants. The general liability policy you carry will likely cover the replacement and repair costs for the damage done to the client’s property.
Example 3: A competitor claims that you are using a logo that is too similar to theirs and takes legal action against your business. Your general liability policy will cover the costs of your legal defense and the costs of paying damages to the competitor if you are found liable, up to your policy limits.
Other Types of Coverage Counseling Centers 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:
Workers' Compensation
Workers’ compensation is a necessity for any business that has employees. Specific legal requirements vary by state, but you are most likely required by law to carry workers’ comp if you have employees. The workers’ compensation insurance you have will cover the costs of treating work-related injuries sustained by employees. It may also help to cover lost wages for the employee.
Professional Liability Insurance
One of the key roles of your counseling team is to provide guidance for patients—which can put your center in a difficult position if someone seeks to blame your business for the actions of patients and files a lawsuit. Professional liability insurance can cover the costs of legal representation and settlements so your center can continue to serve your community even in the event of a lawsuit.
Commercial Umbrella Insurance
A general liability insurance policy that is well-designed for your counseling center should cover most situations—but there is always the possibility that the damage will cost enough that it will exceed your coverage limits. Commercial umbrella insurance is designed to pick up where general liability leaves off. Once the limits of the general liability policy are reached, commercial umbrella coverage takes over so you can avoid paying out of pocket.
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 counseling center:
- 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.
Counseling Center 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.
Yes. It’s important to invest in sufficient business insurance for your counseling center, as it’s the shield that will protect it from all the common risks it is likely to face (e.g., malpractice and improper diagnosis).
What’s more, insurance may even be a legal requirement for your center to operate (depending on your state and circumstances).
Not necessarily. Certain exceptions may be written directly into your counseling center 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.