updated 3/1/2011 9:16:05 AM ET 2011-03-01T14:16:05

FARMINGTON, Conn., March 1, 2011 (GLOBE NEWSWIRE) -- BOLT, a leading insurance agency exclusively protecting small business owners, uncovers several myths that lead owners to put their small businesses at risk. In a recent independent survey of small and home-based business owners, BOLT learned that the majority of these owners are underinsured or not insured at all based on the false belief that their risk is minimal.

"The extensive business owner interviews we conducted exposed some basic business risk myths that point to misinformation as the main culprit preventing business owners from adequately protecting their small businesses," said Tom Hammond, Executive Vice President at BOLT. "The complex nature of the commercial insurance industry has put owners at a information deficit, causing them to unknowingly leave their businesses vulnerable. It only takes one alleged accusation from a disgruntled employee or customer to devastate or terminate a well-run business. Many small and home-based business owners don't even know the extent to which they are putting their businesses, and in many cases their personal assets, at risk."

Well over half of survey respondents qualified as "underinsured" meaning either no insurance, the wrong coverage or lacking coverage in key areas. The research showed that most underinsured small business owners felt fairly comfortable because they perceived themselves to be at minimal risk. Small business owners surveyed cited one or more of the below myths as reasons for this belief:

  1. "The way I run my business, I don't expect to be sued by either customers or employees." Even the best run business can be sued in today's litigious environment and even if the claim is false and no judgment is awarded, the costs to defend the claim in court can bring a business to a full stop, squandering precious time and resources. Commercial Liability policies can pay for the full defense of your business regardless if the claim is true or false.
  2. "I'm protected by Incorporation and my Contracts." The reality is that corporations are separate legal entities and are sued as such all the time for common law torts. In cases of gross negligence, punitive damages could be awarded in addition to general damage awards. In addition, corporate contracts and agreements put into place between clients, vendors, employees and/or 1099 contractors will only recognize transfer of liability for certain types of negligence.
  3. "I have a home based business so I am covered by my homeowners policy." Most personal homeowner's policies exclude coverage for business pursuits.
  4. "I'm covered under my landlord policy." Under most lease agreements, control of the property is relinquished to the lessee and, as such, they are required to carry their own insurance.
  5. "I don't produce a product, so the risk is with the manufacturer." If you alter or re-package a product in any way, you will stand in the place of the manufacturer. You can also be sued for any warranties you make about the product.
  6. "I don't have enough business assets to protect." Depending on the type of business entity, and the claim of liability, personal assets can be exposed.
  7. "I will just close my doors." Bankruptcy laws can be tricky and in many cases its not as simple as just closing your doors. More importantly reputation and good will can be more valuable than the cost of insurance to protect your business.

In addition to falling prey to the misinformation that leads to these kinds of myths, 90 percent of respondents didn't have adequate knowledge of what can be insured at a small business. Many of the owners who did have some amount of insurance shared that they were uncertain about the way they chose their agents as well as whether they were being proactively informed. Nearly all of noninsured small business owners cited the complexity of the process as one key reason for not getting coverage.

About BOLT

BOLT, the Business Owners Liability Team, is a national insurance agency that exclusively protects the owners of small businesses. BOLT agents help business owners choose the right insurance products to fully protect both their businesses and themselves personally. BOLT offers an on-line and interactive experience with leading carriers. As such, business owners can thoroughly compare coverage and pricing, and ultimately purchase cost-effective insurance for their businesses within minutes. Business insurance policies offered by BOLT include, but are not limited to, General Liability, Business Property Insurance, Workers' Compensation, Commercial Auto, Umbrella Insurance, Errors and Omissions, Directors and Officers, Business Interruption, Employment Liability, Sexual Harassment and Flood.  These policies are provided by top-rated insurance carriers such as The Hartford, CNA, Liberty Mutual, Ace and Chubb. BOLT Insurance Agency is headquartered in Farmington, CT, and is licensed to do business in all fifty states. Come visit us at: www.boltinsurance.com

The BOLT Insurance Agency logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8807

CONTACT: Media inquiries:
         Josh Baker
         Director of Marketing

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