Most business problems do not start as big problems. They start small. An email that looks normal. A slip near the front door in February. A leaking pipe above the stockroom. A client who is not happy. A laptop that is suddenly not in the car. I remember an owner telling me, “We’re careful.” Then a laptop with three years of customer files walked out of a café on Elgin Street.
Insurance is how a small business survives the day something goes wrong. Here is what the main coverages are, using an imaginary 900-square-foot gift shop on Bank Street in the Glebe as the example.
Commercial general liability (CGL)
This covers injury to other people and damage to their property caused by your operations. The shop’s classic risk: a customer slips on slush tracked in from the sidewalk, breaks a wrist, and sues. CGL pays the legal defence and any settlement up to the limit. Most landlords in Ottawa require $2 million in CGL before they will hand over keys, and many City of Ottawa event permits and BIA sidewalk sales require proof of it. If you sell products, product liability is usually bundled in.
Commercial property
Covers your stuff: inventory, fixtures, equipment, leasehold improvements you paid for. Fire, theft, water damage, vandalism. The Bank Street shop should insure inventory at its peak, which for a gift shop is mid-November, not July. Under-insuring to save premium is the most common mistake I see.
Business interruption
If a fire upstairs closes the shop for six weeks, property insurance replaces the shelves. It does not replace six weeks of December sales or pay the rent while you are closed. Business interruption does. Ask specifically whether it covers loss caused by an insured event next door or a civil authority closing the street, which has happened in Ottawa during construction and protests.
Cyber and privacy
If you take payments online, keep a customer list, or run payroll, you hold personal data. Cyber coverage pays for breach notification, forensics, and often ransom negotiation. Small policies start well under $1,000 a year. That stolen laptop on Elgin was a cyber claim, not a property claim.
Professional liability (errors and omissions)
For consultants, designers, bookkeepers, and anyone who gives advice for money. Ottawa has a lot of these businesses serving government clients, and federal contracts routinely require E&O. It covers claims that your work caused a financial loss even if nobody was hurt and nothing was damaged.
Commercial auto
If a vehicle is used for deliveries, site visits or hauling stock, a personal auto policy may deny a claim. Tell your broker how the vehicle is really used.
What it costs
For a small retail shop in Ottawa, a package combining CGL, property and basic interruption often runs in the low thousands per year; a solo consultant’s CGL and E&O can be less. Prices vary with location, claims history, alarm systems, and how much inventory you carry. Every quote should show the deductible; a higher deductible lowers premium and is a fine trade if you have the cash cushion described in the finances guide.
How to buy it
Use a broker, not a single insurer’s website. Brokers shop several companies and, more importantly, they are the person you call at 7 a.m. when the pipe bursts. The Insurance Brokers Association of Ontario lists licensed brokers by city. Ask other owners on your street who they use; BIA members tend to converge on two or three local brokerages that know the buildings.
A 20-minute checklist
- Write down the five worst things that could happen to your business this year.
- Match each to a coverage above. Anything unmatched is a question for the broker.
- Photograph your inventory and equipment at peak. Store the photos off-site.
- Read the lease’s insurance clause and send it to your broker.
- Calendar a renewal review 60 days before the policy ends.
Insurance is not optimism or pessimism. It is the price of being able to say “we’ll be fine” and mean it.