The Overlooked Risks in Commercial Insurance
Most business owners believe they’re protected because they hold a couple of standard insurance policies—usually general liability and property insurance. But in today’s rapidly evolving business landscape, that sense of security is often an illusion.
From cyber threats to employee lawsuits, 2025 has introduced a range of new exposures. And the truth is: most businesses won’t know they’re underinsured until after the damage is done.
Let’s break down five commonly overlooked commercial insurance risks—and why they matter now more than ever.
1. Contractors Without Builders Risk Insurance
If you’re in construction or development and only carry general liability, you’re exposed.
Builders Risk Insurance covers theft, vandalism, fire, weather damage, and delays due to loss of materials during the construction phase. General liability policies do not cover damage to materials or the worksite itself.
Example: If a storm floods your half-built structure or tools are stolen from the site overnight, a builder’s risk policy helps you recover those costs. Without it, your timeline and budget could spiral out of control.
2. Directors & Officers Insurance (D&O) for Small Businesses
Think D&O is just for large corporations? Think again.
In 2025, even small and mid-sized business owners are facing personal lawsuits—especially from investors, vendors, or disgruntled former partners.
D&O Insurance protects business leaders from claims of mismanagement, breach of fiduciary duty, or decision-making errors. It’s not just about big firms—it’s about protecting your personal assets from legal exposure tied to your leadership role.
3. Cyber Insurance: The Modern Essential
Property insurance doesn’t cover ransomware. And general liability doesn’t cover phishing scams.
Cyber Insurance is now one of the most essential policies for businesses of all sizes. Whether you run an e-commerce site or store client data in the cloud, you’re a target.
One compromised email can lead to six-figure financial losses—from data breaches, legal fees, to regulatory fines.
In 2025, cybercrime is the fastest-growing threat for U.S. businesses—and basic coverage doesn’t protect against it.
4. Workers’ Comp & Employee Misclassification
Think you’re safe because you only use 1099s or part-time workers? Think again.
Workers’ Compensation Insurance is still required if a contractor is deemed a de facto employee or injured while performing duties for your business.
State laws differ, but courts often side with injured workers—even if you believed the person was a freelancer. Misclassifying workers could trigger massive penalties or denied claims.
5. EPLI: The Surge in Employee Lawsuits
In 2025, wrongful termination, discrimination, and harassment claims are on the rise—and they’re costly.
Employment Practices Liability Insurance (EPLI) covers defense costs and settlements related to employee claims (past or present).
Even a single accusation—founded or not—can cost tens of thousands in legal fees. Yet, many businesses still assume their general liability policy will cover it. It won’t.
Final Takeaway: Insurance Isn’t Just a Checklist—It’s a Strategy
Most businesses are underinsured not by choice, but by assumption. They think they’re covered because they have “the basics.” But today’s business risks are layered, complex, and often hidden.
A smart insurance strategy includes:
Annual policy reviews
Gap analysis and risk audits
Layered commercial policies designed for your business
Don’t let one gap ruin everything you’ve built.
Book a free insurance consultation with Joel Goldman to review your business coverage and identify hidden exposures.
