Why Do Lenders Require Commercial Insurance?

Small businesses make a big difference. With all the work you put into your business, you’ll want to make sure it has the coverage it deserves. Louisiana requires a certain amount of commercial insurance. Plus, you may need commercial insurance to get a loan. Have questions about your coverage options? Insurance & Financial Services Inc. can help. We’re right here in Baton Rouge, LA. Meanwhile, read on to find out why lenders often require commercial insurance. 

Investment Protection 

Your business is a key part of your livelihood. If anything goes wrong, insurance can protect you from financial difficulties. 

A lot of people buy insurance to protect an investment. Well, if you finance your business with a loan, then you’re not the only one who has invested in your business. Your lending company has taken a risk too, and your lenders will want to mitigate that risk as much as possible. 

If you have commercial insurance, your lender can rest assured that you’ll be able to pay back your loan, even after a disaster. 


Getting a loan is a minefield. Often, it all comes down to your credit score. But what if you don’t have a high credit score? Can you still get a business loan? 

Yes, but you may have to jump through some extra hoops. For instance, you may need collateral. But if your collateral is damaged in an accident, then it can’t help you or your lender. If your collateral comes from your business itself, then a lender may want to know that your collateral is covered. 

Commercial Insurance Questions and Answers 

Want to make sense of commercial insurance? We’re here to answer your questions. Contact Insurance & Financial Services Inc. today. We can help you from right here in Baton Rouge, LA.