Every business, even if home-based, needs to have liability insurance. The policy provides both defense and damages if you, your employees or your products or services cause or are alleged to have caused Bodily Injury or Property Damage to a third party. Both types of insurance policies protect against losses caused by the company or its employees in addition to protection against third-party lawsuits. Also, some businesses may carry business interruption insurance. This explanation of insurance benefits is provided by Insurance Marketplace.