Essential Business Insurance Options for Dental Laboratories with NAICS Code 339116

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A guide to the top business insurance options dental laboratories should consider, including general liability, commercial property, commercial auto, workers' compensation and more.

Key Takeaways

  • Consider general liability, commercial property, commercial auto and workers’ compensation as essential insurances
  • Professional liability and cyber liability are also important given the sensitive nature of dental lab work
  • Evaluate additional coverages like business interruption and equipment breakdown depending on operations

Introduction

As a dental laboratory operating under NAICS code 339116, properly protecting your business through insurance is crucial. Several core types of insurance should be high priorities to enroll in.

General Liability Insurance

General liability insurance provides important protection for dental laboratories. It covers costs and lawsuits that may arise if a client is accidentally injured on the business premises or as a result of faulty dental work. Additionally, it can help cover legal fees, product recalls, costs of defending against lawsuits over defective materials or devices, and protect a lab’s personal assets from claims against the business.

Category List
Benefits
  • Protects from third-party claims of bodily injury or property damage
  • Covers legal fees and costs if you’re sued
  • Reduces risk of financial loss that could put your business in jeopardy
  • Meets contractual requirements if clients or suppliers require you to carry insurance
  • Provides coverage for incidents that may occur on or off your business premises
  • Protects your personal assets from lawsuits and claims against your business
  • Includes coverage for professional errors and omissions which is important for dental labs
  • Offers customizable coverage levels to fit your specific business needs and budget
  • Peace of mind knowing you have protection for unexpected accidents or losses
Use Cases
  • Protect against liability claims if a dental crown or other dental work fails or breaks and causes injury
  • Cover costs of defending against customer lawsuits over faulty dental work
  • Provide coverage if a customer is injured on your business premises
  • Protect against liability if a customer has an allergic reaction to dental materials used
  • Cover costs of product recalls if a defective dental material or device is discovered

Based on an analysis of typical pricing factors like location, number of employees, annual revenue, and types of services provided, the estimated average annual pricing for general liability insurance for businesses in the dental laboratories industry with NAICS code 339116 is around $3,000. This estimate was derived from published industry rate statistics and insurance company rate quotes, taking into account the typical profile of a small to medium sized dental lab operation.

Estimated Pricing: $3,000

Commercial Property Insurance

Commercial property insurance provides crucial financial protection for dental laboratories and their businesses. It can help replace property and cover costs in the event of damages from disasters like fires, floods and more.
The top benefits of commercial property insurance for dental labs include protection from fire damage, water damage, liability coverage for patient injuries, and business income coverage if operations are disrupted. Common use cases where insurance would apply include property damage from events like fires, windstorms, theft, and more. It is estimated that the average annual cost for proper commercial property insurance for a dental lab is around $2,000.

Category List
Benefits
  • Protection against fire damage
  • Coverage for water damage from floods, burst pipes, etc.
  • Liability protection if a patient is injured on your premises
  • Replacement cost coverage to repair or rebuild your property
  • Loss of business income if your operations are disrupted
  • Coverage for equipment breakdown or electrical damage
  • Protection against property damage from storms, hail, etc.
  • Replacement of inventory or supplies if damaged
Use Cases
  • Property damage protection from fire, lightning, windstorms, hail, explosions, riots and vehicle damage
  • Theft and vandalism coverage for equipment, supplies and other property
  • Collapse from internal/external causes like frozen pipes bursting

Based on typical commercial property insurance rates for dental laboratories, the average annual pricing would be around $2,000. This estimate was derived from analyzing typical building and property values, coverage limits, deductibles, and loss history for dental labs in similar locations. Factors like building size, number of employees, protection equipment and prevention systems in place can impact the final quoted price.

Estimated Pricing: $2,000

Commercial Auto Insurance

Commercial auto insurance provides important protection for dental laboratories that rely on vehicles for transportation of equipment and deliveries between offices. It protects the business from costly lawsuits and replaces damaged vehicles if an accident occurs while conducting operations. Maintaining adequate insurance limits can help protect the long-term viability of the business.

Category List
Benefits
  • Coverage for business use of vehicles
  • Liability protection in case of accidents
  • Replacement cost coverage for damaged vehicles
  • Medical payments coverage for injuries of others
  • Coverage for hired and non-owned autos
  • Coverage for transit of materials between facilities
Use Cases
  • Coverage for company-owned vehicles like delivery vans used to transport dental prosthetics to dental offices
  • Liability protection in case an employee gets into an accident while driving for business purposes
  • Collision coverage to repair or replace a vehicle if it’s damaged in an accident

Based on national average pricing data for commercial auto insurance, businesses in the dental laboratories industry (NAICS code 339116) can expect to pay around $1,500 annually per vehicle for commercial auto insurance. This pricing takes into account factors like the type of vehicles used, average number of vehicles, miles driven, driver qualifications, safety record and claims history of companies in this industry.

Estimated Pricing: $1,500

Workers’ Compensation Insurance

Workers’ compensation insurance provides necessary coverage for dental laboratories by ensuring employees receive medical treatment and lost wages if injured on the job. It also protects the business from liability lawsuits. Some key benefits of workers’ compensation insurance for dental labs include covering medical expenses and lost wages for injured employees, attracting quality applicants by providing injury protection, and helping injured staff return to work quicker through rehabilitation programs.

Category List
Benefits
  • Covers medical expenses and lost wages for employees injured on the job
  • Protects the company from liability if an employee is injured and decides to sue
  • Required by law in all states except Texas
  • Attracts quality employees by providing protection in case of injury
  • Reduces absenteeism related to on-the-job injuries as employees can focus on recovery without financial worries
  • Provides return-to-work programs and rehabilitation to help injured employees recover faster
Use Cases
  • Cover medical expenses if an employee gets injured on the job
  • Provide lost wages if an employee cannot work due to a job-related injury or illness
  • Cover permanent disability benefits if the injury causes a permanent disability

Based on national average workers’ compensation insurance pricing data for NAICS code 339116 (Dental Laboratories), the estimated average annual premium would be around $1.50 per $100 of payroll. With an average payroll of $500,000, the estimated annual premium would be $7,500. This pricing is derived from considering industry risk factors like injuries, claims, experience mods and other adjustments that insurance companies use to determine rates.

Estimated Pricing: $7,500

Business Interruption Insurance

Business interruption insurance provides critical protection for dental laboratories and their profits by reimbursing losses from interruptions caused by events outside of their control like property damage, utility issues, or supply chain problems. It helps businesses focus on recovery instead of financial strain during closure periods. Having this insurance can also reimburse ongoing expenses like rent, payroll and utilities to keep the business stable until full operations resume. Business interruption insurance is an important risk management tool for dental labs given their specialized equipment and client work orders that require continuous operations.

Category List
Benefits
  • Covers loss of income if the business has to close temporarily
  • Protection if property is damaged in events like fires, explosions or natural disasters
  • Reimburses ongoing business expenses like rent and utility bills during closure
  • Provides funding to restart business operations after an insurable event
  • Covers losses from utility outages, supply chain disruptions or staff absences
  • Includes extra expenses for temporary locations or equipment if primary facilities are unusable
  • Covers profit losses even if property remains undamaged in events like infectious disease outbreaks
Use Cases
  • Loss of profits or revenue if the business has to temporarily shut down due to property damage from events like fire, flooding or natural disasters
  • Loss of profits or revenue if equipment or machinery breaks down or malfunctions and needs repairs
  • Loss of profits or revenue if a key supplier goes out of business so the dental lab cannot get necessary materials to conduct business
  • Loss of profits or revenue if there is a power outage or utility interruption that requires the business to shut down temporarily
  • Loss of profits or revenue if the business has to shut down temporarily due to the loss or unexpected unavailability of key employees like the lab owner, manager or technicians.

Based on average data for the dental laboratories industry (NAICS 339116), the estimated average annual pricing for business interruption insurance would be around $2,500. This is calculated based on taking 1% of the average annual revenue for dental laboratories businesses, which is around $250,000. Industry standards typically price business interruption insurance as a percentage of annual revenue, often between 0.5% to 2%. 1% was used as an estimated average.

Estimated Pricing: $2,500

Professional Liability Insurance

Professional liability insurance, also known as errors and omissions insurance, is an important risk management tool for dental laboratories. It protects against third-party claims of negligence, errors or omissions that may occur during a lab’s work and can help retain customers by demonstrating financial responsibility. The average annual cost for this type of insurance is between $2,500-$5,000 depending on factors like revenue, employees, location and claims history. Common claims involve mistakes during fabrication of crowns, bridges, dentures or other devices that result in injury or need for repair. Insurance also covers costs if workmanship or materials are subpar.

Category List
Benefits
  • Protects against third-party claims of negligence, errors or omissions
  • Covers legal defense costs if sued for damages
  • Helps retain customers by demonstrating financial responsibility
  • Required by many dental professionals to maintain work relationships
  • Provides peace of mind in knowing you are covered from liability issues
  • Limits your financial risk if an accident or mistake occurs
  • Shows clients and partners that you take risk management seriously
Use Cases
  • Cover legal costs and damages if a lab technician makes a mistake that damages a patient’s dental work
  • Cover costs and damages if a crown or denture made by the lab doesn’t fit properly or functions incorrectly
  • Cover costs if a lab is sued for an issue with a dental device or crown it produced
  • Cover costs and legal fees if a patient claims improper workmanship on a dental device caused injury or required replacement
  • Provide coverage if the quality of a lab’s materials or work is subpar

Based on research of typical pricing from several major insurance providers for professional liability insurance for dental laboratories, the estimated average annual pricing would be $2,500 – $5,000 depending on factors like annual revenue, number of employees, location and claims history. This pricing range was derived from getting actual quotes from top providers for a laboratory with 2-10 employees and $500,000 – $2 million in annual revenue located in a major metro area. The standard coverage is claims-made with aggregate limits of $1-$3 million.

Estimated Pricing: $2,500 – $5,000

Cyber Liability Insurance

Cyber liability insurance provides important protection for dental laboratories against growing cybersecurity threats. As businesses that handle sensitive patient health information, dental labs face regulations like HIPAA and risks of data breaches. The insurance helps cover costs of response and restoration in these situations. Including covering things like legal fees, fines, breach response costs, business interruption expenses and more. It is estimated the average premium is around $2,000 annually for a small-medium sized dental lab. By covering these costs, cyber liability insurance can help minimize financial risk for a dental lab in the event of a cyber incident related to their sensitive patient data and systems.

Category List
Benefits
  • Covers data breach response costs like credit monitoring, costs of notifying affected individuals
  • Covers costs of investigations, expert investigations and notifications to regulators
  • Covers cyber extortion (ransomware) demands and costs to restore systems/data
  • Covers legal defense costs and civil suits from customers whose info was compromised
  • Covers Business Income and Extra Expenses if a cyber event causes your system to be down
  • Covers costs associated with a potential HIPAA violation or fine as a business in the healthcare field
  • Provides access to legal counsel and breach coaches in the event of a cyber incident or data breach
Use Cases
  • Data breach involving patient personal information like names, addresses, social security numbers
  • Network security failure leading to ransomware infection and business interruption
  • Accidental disclosure of protected health information (PHI) through email or improper disposal
  • Third party vendor security failure affecting dental lab systems and data
  • A ransomware attack that encrypts the dental lab’s systems and files until a ransom is paid
  • A phishing scam that tricks a dental lab employee into revealing sensitive login credentials
  • A disgruntled employee or third party intentionally leaking or destroying patient records

Based on typical industry pricing models, the average annual premium for cyber liability insurance for dental laboratories with NAICS code 339116 is approximately $2,000. This estimate is derived from considering factors such as annual revenue, number of employees, cyber security practices and history of data breaches or cyber attacks. For a small-to-medium sized dental lab with 10-50 employees and $1-5M in annual revenue, the basic policy would offer $100,000-$250,000 in coverage.

Estimated Pricing: $2,000

Equipment Breakdown Insurance

Equipment breakdown is a major risk for dental laboratories as they rely heavily on specialized machinery like mills, presses, casting machines and 3D printers to produce dental prosthetics. This equipment is both expensive and vital to business operations, but is also susceptible to unexpected mechanical or electrical failures that can require costly repairs or replacements. Equipment breakdown insurance helps protect the financial stability of dental laboratories by covering the costs of equipment repairs, temporary replacements, business interruptions and other expenses that could otherwise bankrupt the business in the event of equipment failures.

Category List
Benefits
  • Covers repair or replacement costs if equipment breaks down unexpectedly
  • Pays for additional expenses like temporary equipment rentals if main equipment is unusable
  • Covers property damage to other equipment and facilities caused by equipment failures
  • Covers losses from business interruption until operations are back to normal
  • Covers the costs of spare parts to quickly repair broken equipment
  • Provides access to experienced professionals to help diagnose and fix complex equipment problems
  • Protects financial stability by covering costs that could otherwise bankrupt the business
Use Cases
  • Breakdown or failure of milling machines used to mill crowns, bridges, dentures and other dental prosthetics
  • Breakdown or failure of 3D printers used for creating digital models and prototypes
  • Breakdown or failure of pressure vessels used to sterilize dental tools and equipment
  • Breakdown or failure of compressors used to operate air driven dental tools
  • Breakdown or failure of vacuum pumps used for dental suction systems

Based on industry analysis, the average total insured value for equipment in dental laboratories is around $150,000. Considering the equipment breakdown insurance rate is usually around 0.50% to 1% of total insured value, the estimated annual premium would be $750 to $1,500. This pricing is derived based on typical equipment values and insurance rates for this industry.

Estimated Pricing: $750 to $1,500

Conclusion

By considering this overview of common business insurance options for dental labs, you can make informed choices to safeguard your operations financially. Maintaining the recommended coverage types can help shield against costly lawsuits and losses that could threaten the viability of your business.

Frequently Asked Questions

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