In simple terms, specialty insurance coverage is exactly what it sounds like: It's insurance that can be purchased for items that are special or unique. Specialty insurance policies are important for items that are not typically covered under other insurance policies.

Find the specialty insurance for your business needs.

Small businesses have abundant insurance needs, but even the most highly recommended business insurance policies don't cover everything. Worse yet, when you're paying a lot of money for all that insurance, it may feel like adding insult to injury to undergo a serious event and not have your insurance cover it. That's where specialty insurance comes in – and it's rarely anywhere close to expensive as your ordinary business coverage.

Specialty insurance plans are made specifically for businesses or individuals that need unusual coverage. These  accounts may involve high-risk holdings or feature objects that are not usually covered under standard business insurance policies. As an example, guns and antiques are two items that require specialty insurance in order for the investment to be protected adequately.

Does specialty insurance protect against lawsuits?

Like other types of insurance plans, specialty insurance offers protection against lawsuits. If a business is sued and a judgment made against it, it needs to recover financially. Many issues a business faces are covered under a specialty policy called errors and omissions, or E&O. With E&O, the company is protected against negligence lawsuits. The policy will have limits, but it traditionally covers judgments, court fees and legal fees.

Examples of specialty insurance policies

Specialty insurance is necessary for items that your ordinary homeowners or automobile insurance doesn't cover. The following types of specialty insurance can help fill in the gaps:

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• Identity theft insurance. Identity theft can be costly, especially if your company's bank accounts are compromised. Identity theft insurance can help you cover those costs.

• Cyber liability insurance. As the frequency of cyberattacks on small businesses increases, cyber liability insurance can help them cover the accompanying financial losses. It can also cover your legal costs if customers sue you over data breaches.

• Directors and officers (D&O) insurance. D&O insurance protects you if you face lawsuits alleging wrongdoings in your management of your business.