Business insurance is insurance that is purchased by business owners in order to protect themselves from liabilities and losses related to the operation of their businesses. In the context of the law, businesses have many legal liabilities and without business insurance, business owners would have to pay for many losses related to these liabilities themselves.
Liabilities that a business can have include product liabilities, injury liabilities, etc. A business can also potentially face losses if a fire occurs in the building that it is housed in, if materials or machines are stolen from the premises, if a flood occurs in the business's immediate surroundings, etc. Business insurance can protect businesses financially from these types of losses. In order to receive insurance coverage, a business owner must purchase a business insurance policy from an insurance company.