As an entrepreneur, keeping your small business safe from risks is key. With over half a million new businesses in the U.S. each month1, good insurance is vital. Our agency focuses on offering top-notch insurance. We tailor our policies specifically for your business. This helps protect and secure your investment, giving you peace of mind.
Small business insurance prices vary. You can pay from $20 to over $125 per month, based on what coverage you need2. For many, a Business Owner’s Policy (BOP) is a smart pick. It costs between $40 and $100 monthly on average2. A BOP includes general liability, property, and business interruption cover. These are essential and customized to fit your business’s unique needs.
We know small business owners worry a lot about liability insurance cost and coverage, according to the NFIB1. Our team is dedicated to finding you the best, budget-friendly insurance. With us, you can get protected from injuries, damages, and personal injury claims without breaking the bank1.
Key Takeaways
- Small business insurance can cost between $20 and $125 per month or $240 to $1,500 annually, depending on the coverage.
- A Business Owner’s Policy (BOP) is a favorite, typically costing $40 to $100 monthly.
- Liability insurance tops the list of concerns. It helps guard against injuries, damages, and injury claims.
- We offer insurance that fits your business perfectly, offering great coverage and peace of mind.
- Ensuring your business stays protected with affordable and strong insurance is our priority.
Understanding the Cost of Small Business Insurance
As a small business owner, it’s vital to know the costs of insurance. This knowledge helps in managing your budget and securing your finances. The price of insurance for small businesses can range greatly, starting at about $20 per month. It can go up to over $125 monthly or between $240 to $1,500 every year. The amount you pay depends on the types of insurance your business needs.32
Average Monthly and Annual Premiums by Policy Type
Let’s look at the average costs of various insurance policies for small businesses:
| Policy Type | Average Monthly Premium | Average Annual Premium |
|---|---|---|
| Business Owner’s Policy (BOP) | $5732 | $68432 |
| General Liability Insurance | $4232 | $50032 |
| Commercial Property Insurance | $673 | $804 |
| Business Interruption Insurance | $402 | $480 |
| Workers’ Compensation Insurance | $4532 | $542 |
| Commercial Auto Insurance | $1473 | $1,762 |
| Professional Liability Insurance | $613 | $735 |
| Cyber Liability Insurance | $1453 | $1,740 |
| Commercial Umbrella Insurance | $753 | N/A |
Factors Affecting Small Business Insurance Cost
Many factors affect the cost of small business insurance, like34:
- Policy limits and deductibles
- Industry type and risk profile
- Business location
- Number of employees
- Annual revenue
- Claims history
- Types of insurance coverage
- Business property value
Other elements also influence cost, such as24 business size and age, level of fire protection, and perils covered. These can change how much you pay for commercial property and business owners’ policies.
Knowing these aspects can help you choose the right insurance for your small business. You can get solid coverage at good prices by understanding these factors.
General Liability Insurance: Safeguarding Your Business
General liability insurance is key for small business owners. It protects you from claims about injuries, damages, and more.5 Most businesses need this and professional liability insurance.5
Industry Type and Business Size
The price of this insurance changes with your industry and company size. For example, construction businesses might pay more because they’re seen as riskier.6 The number of employees also affects the cost. More employees can mean higher costs, showing a bigger risk.
Claims History and Location
The insurance cost is influenced by your claims history and where your business is. If you had many claims, your cost might go up.6 Also, different states or areas have different rules and costs of living. This can change how much you pay too.6
For small businesses, the average monthly cost is $40 to $55, or $480 to $660 a year.5 But, what you actually pay depends on your business’s risks and needs.
Commercial Property Insurance: Protecting Your Assets
Keeping your business safe is a big deal for us. That’s why we offer7 commercial property insurance. It’s not always a must, but it’s smart to have. This insurance helps a lot if you rent your business space because the owners might ask for it.7
Saving money matters to us, too. We suggest a7 business owner’s policy (BOP). It combines general liability and property insurance. Plus, you might get a discount, up to 10%, by buying several insurances at once.7
The price of789 commercial property insurance depends on many things. This includes your property’s value, where it is, its condition, safety measures, what you use it for, and its worth. You can choose between insuring for the property’s full value or its current cash value.789
7 Your business can also insure more than one party in the policy. This offers a wider protection. We’re here to help you understand different coverages and get quick quotes online. Our goal is to make sure you pick a policy that fits your needs.7
78 Dealing with claims is easy with us. You can file them on the web. We also provide online account services, making it simple to keep track of your insurance. We’re experts at protecting your business’s property well, including machines, stock, and buildings.78
Business Interruption Insurance: Ensuring Continuity
Business interruption insurance, or BI coverage, keeps your business financially safe. It helps when an insured event stops your operation. Your costs are covered while your doors are closed. Factors in BI costs include:
Revenue, Property Value, and Coverage Limits
Your BI policy cost is based on your business’ revenue, property value, and coverage limits. Businesses that earn more and have pricier properties pay more for BI. The policy’s coverage limit also affects the cost. A higher limit means higher premiums. This lets you know what to expect in your bill.
Costs are also tied to your industry, number of employees, business location, and the risk of certain events. But, BI plans don’t cover everything. They usually leave out damage from broken items or certain natural disasters. They also may not cover losses from communicable diseases shutting down your business.
30-40% of small business owners invest in BI,10 since it’s key for keeping the business going and softening the blow of unexpected stops. A BI policy may cost between $40 to $130 monthly, or $480 to $1,560 yearly,11 but it’s money well spent to protect your business’s income and assets.
A Business Owners Policy (BOP) could be a good option. It combines general liability, commercial property, and BI cover. On average, a BOP costs $53 per month,11 making it a smart choice for smaller businesses with up to 100 employees and about $5 million in revenue. But, it’s good to remember that pandemics are usually not covered by insurers.11
BI policies often don’t cover pandemics, requiring physical property damage. But, the COVID-19 pandemic has changed this. Businesses are filing lawsuits to cover their pandemic losses. According to the University of Pennsylvania, there have been almost 2,300 such cases. Many are from the food industry.11
BI insurance plays a crucial role in risk management. It ensures your business can keep going through surprise stops. Knowing the elements that affect your BI premium lets you protect your business better. This knowledge prepares you for any challenges ahead.
Workers’ Compensation Insurance: Covering Employee Injuries
Protecting your workers and business’s finances is key as a small business owner. Workers’ compensation insurance is crucial for this. It pays for medical bills and some lost wages when employees get hurt at work or fall ill.12
Calculating Workers’ Comp Premiums
Calculating workers’ comp premiums for your small business involves several factors. It looks at your payroll, your employees’ job codes, and your modification rate.12 The premium is found with this formula:
Workers’ Comp Premium = (Payroll / 100) x Rate per $100 of Payroll x Experience Modification Rate
The “rate per $100 of payroll” is pre-set and depends on your industry’s risk. Your modification rate is a score showing your past claims, affecting your premium.12
Knowing how to calculate these premiums helps manage costs. Focus on workplace safety, employee training to reduce risks, and keeping your claims low.12
Getting workers’ compensation insurance isn’t just about following laws. It’s a wise move to safeguard your business and show you care for your team’s wellness.12 With the right policy, you can grow your business confidently.
Commercial Auto Insurance: Protecting Your Fleet
For small business owners, handling commercial auto risks and costs can be tough.13 With more cars on the road, drivers not paying attention, and repair costs going up, your policy needs can change.13 It’s key to have coverage for things like liability, damage to your vehicles, and protection if someone’s hurt in an accident.13
Factors Influencing Commercial Auto Rates
Almost every state requires commercial auto insurance by law.14 But, it’s usually more costly than personal insurance because of the bigger risks.14 Several things affect how much you pay for your policy:
- Driver Records: How your employees drive matters. If they’ve been in accidents or got tickets, your rates might go up.13
- Vehicle Type: Different cars, trucks, or vans you use mean different premiums.14
- Coverage Limits: The more coverage you get, the more it might cost.14
- Owned and Non-Owned Vehicles: If both your company’s vehicles and those used for work are covered, that’s part of your commercial auto policy.14
It’s wise to think about getting additional coverage for vehicles you rent or when employees use their own cars for work.14 This could cover damages from accidents. Also, business auto insurance might protect you if your work vehicles are used for personal errands.14
We have a team ready to help make your fleet safer. They can advise on driver rules, policies to fight drivers’ distraction, and devices that track driving habits.13 Plus, our experts in handling claims due to car accidents know their stuff. They work fast to get your vehicles back on the road as soon as possible.13
Thanks to our advanced tools and knowledge, we quickly assess claims and manage legal aspects. This helps you avoid long vehicle downtimes.13 We use this expertise to provide top service and coverage options tailored to your business needs.13
No matter the size of your business, we’re here to guide you through commercial auto insurance complexities and keep you covered.15 Building a strong partnership with your insurance agent helps a lot. It ensures smooth claims and keeps your business running well.15
Professional Liability Insurance: Safeguarding Your Expertise
Being a small business owner means keeping your expertise safe is key. Professional liability insurance, also called errors and omissions (E&O) coverage, helps prevent your business from claims of error or financial loss.16 It pays for legal defense and any resulting costs, protecting your business from big financial hits.
Industry, Location, and Experience
How much you pay for professional liability insurance changes with your industry, where you are, and how long you’ve been in business.16 If you work in law, medicine, or finance, you might have to get this insurance by the law or industry rules.16 How risky your location is and your business’s age also affect what you pay.17 Professionals with a lot of experience might pay less because of their good reputation. But, new businesses could pay more as they try to build their name.
Coverage Limits and Deductibles
The cost of your insurance also depends on your coverage limits and deductibles.18 If you pick higher coverage, you’ll likely pay more. This is because the insurance company risks more money. Choosing a lower deductible also means you might pay more often, but it offers better protection when you have a claim.16 It’s important to balance cost and coverage so your business stays safe and within budget.
Getting professional liability insurance is smart for anyone in business, whether you’re just starting or have been at it for a while. Knowing what drives the cost can help you pick the best plan for your business’s needs and risks.
Product Liability Insurance: Protecting Your Products
is key for protecting your small business against lawsuits.19 If your product causes harm, this insurance helps. It was very important in 2014, with more than 58,000 cases, a 20% rise from 2013.19 Lawsuits in 2012 ended with an average $3,439,035 jury award, showing the big risk without insurance.19
The price you pay for is tied to what and how much you sell.19 More products mean a higher chance of a defect. As your business grows, so does the need for good coverage.19 Should a lawsuit happen, this insurance also helps with costs like legal fees and medical bills.19
On average, this insurance costs $1,192 yearly for small businesses.20 Manufacturers average $1,146, and wholesalers $1,159. The price can change based on your business’s specifics.20
All businesses that sell products should consider getting .19 Lawsuits are on the rise, making this coverage more crucial. The type and amount of your products, your sales level, and your business partners affect your insurance needs.20
For those on Amazon, you can find this insurance through the Amazon Insurance Accelerator.20 It includes coverage from multiple providers like Chubb and Travelers. Depending on your business, the needed coverage and cost can vary. It’s important to understand your policy before buying.20
| Product Category | Risk Level for Product Liability Insurance |
|---|---|
| Furniture | Higher Risk |
| Electronics | Higher Risk |
| Bicycles | Higher Risk |
| Food and Beverages | Higher Risk |
| Products Used by Children | Higher Risk |
Where you sell or make your products affects your risk of a lawsuit.20 Consider this when choosing insurance. If you have vendors, their contracts might require specific coverage too.20
Insurance for Small Businesses: Cyber Liability Coverage
In the digital world, having cyber liability insurance is very important for small businesses now.21 It protects them from various tech risks.21 Data breach insurance helps if there’s a breach and supports small business owners.21 But,22 cyber liability insurance aims more at bigger businesses.21 It gives extra coverage to bounce back from cyberattacks.21 These attacks can lead to big costs for legal help, telling customers what happened, paying a ransom, losing income, and getting charged by regulators.21
Company Size, Industry, and Revenue
The amount you pay for cyber liability insurance depends on how big your business is, what it does, and how much it makes.21 Things like customer numbers, the kind of data you keep, your revenue, and your claims history can change this cost.21 Small businesses might just need data breach insurance.21 But, bigger ones or those with important data might want the stronger protection that cyber liability insurance like CyberChoice First Response offers.21 If your business makes over $50 million a year, you can get a cyber insurance quote by talking to a regional underwriter. Smaller companies can ask for a quote from a local insurance agent.21
Cybersecurity Measures and Coverage Limits
22 Cyber liability insurance protects your business from many common cyber threats like malware, phishing, data breaches, ransomware, and theft of devices.22 These threats happen every day, so it’s smart for businesses to have cyber insurance.22 It covers a lot of costs, such as breach responses, handling extortion, fighting off phishing attacks, dealing with network outages, facing privacy lawsuits, absorbing fines, and the expenses of dealing with a breach, investigating what happened, managing crises, experiencing business stoppages, and letting your customers know about the breach.22 The price of this insurance changes based on the business’s needs and what protection it wants.22
22 Besides cyber liability insurance, small companies should think about getting other insurance too.22 This includes general liability, professional liability, policies for employment practices, and insurance for commercial property, Business Owners Policy (BOP), and commercial vehicles.22 Adding these policies gives small businesses a complete risk management plan for the digital age.
Umbrella Insurance: Comprehensive Protection
As business owners, safeguarding our companies is key. Commercial umbrella insurance is a vital part of this effort. It steps in when our other insurance reaches its limit, offering more liability protection.23
Policy Limits and Industry Impact
Commercial umbrella policies usually offer up to $15 million in coverage. They are sold in $1 million increments.24 The cost rises with more coverage, averaging around $40 a month for every $1 million. However, nearly a third of small businesses pay under $100 monthly for their coverage.24 The price depends on our business’s risk profile and the coverage we already have.
Underlying Coverage Risks
Having an commercial umbrella insurance policy is like having a financial safety net. It covers the gaps when other policies max out. For instance, if we face a $1.5 million lawsuit with only $1 million coverage, the umbrella policy fills in the $500,000 difference.23
This protection goes beyond just legal costs. It may also handle property damage expenses for assets not ours.25 And, with additions like liability for rented autos, employee practices, and officers’ actions, our shield against liability is stronger.23
By having commercial umbrella insurance, we can rest easier. It protects our business from unforeseen legal battles. This crucial yet affordable policy can secure our financial future and help us face any liability issue with confidence.
Cost-Saving Strategies for Small Business Insurance
Running a small business means watching our insurance budget carefully. It’s vital to find good coverage that doesn’t cost too much. Luckily, there are ways to make sure we get the most for our money without overspending.26
Annual Payment Discounts
Paying for insurance once a year can be cheaper than paying each month. Many insurance companies give discounts for yearly payments. This helps us save a lot of money in the long term.26 Also, combining different policies, like a Business Owner’s Policy (BOP), can lower the total cost even more.26
Risk Management and Claims Prevention
Preventing accidents and managing risks well can also reduce insurance costs. This means putting safety measures in place and asking for discounts based on our safety record. It’s an effective way to save money over time.26 Reviewing our coverage regularly to match our business’s current needs is wise. This ensures we’re not paying for more insurance than we really need.26
Moreover, we can save by making some changes to our policy, like choosing a higher deductible. This might lower our yearly insurance expenses.26 Checking different policies and insurance companies regularly is key. It may lead to finding better deals, saving money for our business.26
FAQ
What is the average cost of small business insurance?
FAQ
What is the average cost of small business insurance?
Small business insurance often starts at a month. The price can go up to 5 monthly or 0 to
FAQ
What is the average cost of small business insurance?
Small business insurance often starts at $20 a month. The price can go up to $125 monthly or $240 to $1,500 yearly. It all depends on the type of insurance you need.
One popular choice is a business owner’s policy (BOP), which usually costs between $40 and $100 each month.
What are the different types of small business insurance policies and their average costs?
The article has a table with the average costs of different policies. Here’s a quick look at a few:
- General Liability Insurance: $40-$55 per month or $480-$660 annually
- Commercial Property Insurance: The price varies by property value, location, and coverage limits
- Business Interruption Insurance: This price changes based on your business’s revenue and coverage needed
- Workers’ Compensation Insurance: Calculated using your payroll, job code, and claim history
- Commercial Auto Insurance: The cost depends on your drivers’ records and the type of coverage needed
- Professional Liability Insurance: Pricing differs by industry, location, experience, and coverage
- Product Liability Insurance: Like General Liability, the price is affected by product type and coverage needs
- Cyber Liability Insurance: The price is determined by company size, industry, and coverage limits
- Commercial Umbrella Insurance: The cost goes up with more coverage
What factors affect the cost of general liability insurance for small businesses?
Industry type, business size, claims history, and location all affect general liability insurance costs for small businesses.
What factors influence the cost of commercial property insurance for small businesses?
The cost of insuring your business property depends on its value, your business’s location, and the type of property covered. It also varies with the coverage you select.
How does business interruption insurance protect small businesses, and what factors affect its cost?
Business interruption insurance helps cover losses from a pause in your business due to an insured event. It considers your revenue, property value, and chosen coverage limits when calculating costs.
How is the cost of workers’ compensation insurance calculated for small businesses?
Workers’ compensation premiums are calculated from your company’s payroll, job codes, and claims history.
What factors influence the cost of commercial auto insurance for small businesses?
Driving records, vehicle types, and the coverage you choose all affect the cost of your commercial auto insurance.
How does professional liability insurance protect small businesses, and what factors affect its cost?
This insurance, also known as E&O, covers you against claims of negligence. Its cost is impacted by your industry, location, experience, and policy details.
What factors impact the cost of product liability insurance for small businesses?
Product liability insurance costs are affected by the industry, product type, claim history, and the coverage you need.
How does cyber liability insurance protect small businesses, and what factors affect the cost?
Cyber insurance guards against losses from data breaches. Its cost depends on your business’s size, industry, revenue, security measures, and coverage.
How does commercial umbrella insurance benefit small businesses, and what factors influence the cost?
Commercial umbrella coverage supplements general liability, commercial auto, or employer’s liability insurance when their limits are maxed out. Its cost increases with more coverage.
What cost-saving strategies can small businesses use for their insurance coverage?
To save on insurance, small businesses can pay annually for discounts. They can also use strong risk management practices and reduce claims.
,500 yearly. It all depends on the type of insurance you need.
One popular choice is a business owner’s policy (BOP), which usually costs between and 0 each month.
What are the different types of small business insurance policies and their average costs?
The article has a table with the average costs of different policies. Here’s a quick look at a few:
- General Liability Insurance: – per month or 0-0 annually
- Commercial Property Insurance: The price varies by property value, location, and coverage limits
- Business Interruption Insurance: This price changes based on your business’s revenue and coverage needed
- Workers’ Compensation Insurance: Calculated using your payroll, job code, and claim history
- Commercial Auto Insurance: The cost depends on your drivers’ records and the type of coverage needed
- Professional Liability Insurance: Pricing differs by industry, location, experience, and coverage
- Product Liability Insurance: Like General Liability, the price is affected by product type and coverage needs
- Cyber Liability Insurance: The price is determined by company size, industry, and coverage limits
- Commercial Umbrella Insurance: The cost goes up with more coverage
What factors affect the cost of general liability insurance for small businesses?
Industry type, business size, claims history, and location all affect general liability insurance costs for small businesses.
What factors influence the cost of commercial property insurance for small businesses?
The cost of insuring your business property depends on its value, your business’s location, and the type of property covered. It also varies with the coverage you select.
How does business interruption insurance protect small businesses, and what factors affect its cost?
Business interruption insurance helps cover losses from a pause in your business due to an insured event. It considers your revenue, property value, and chosen coverage limits when calculating costs.
How is the cost of workers’ compensation insurance calculated for small businesses?
Workers’ compensation premiums are calculated from your company’s payroll, job codes, and claims history.
What factors influence the cost of commercial auto insurance for small businesses?
Driving records, vehicle types, and the coverage you choose all affect the cost of your commercial auto insurance.
How does professional liability insurance protect small businesses, and what factors affect its cost?
This insurance, also known as E&O, covers you against claims of negligence. Its cost is impacted by your industry, location, experience, and policy details.
What factors impact the cost of product liability insurance for small businesses?
Product liability insurance costs are affected by the industry, product type, claim history, and the coverage you need.
How does cyber liability insurance protect small businesses, and what factors affect the cost?
Cyber insurance guards against losses from data breaches. Its cost depends on your business’s size, industry, revenue, security measures, and coverage.
How does commercial umbrella insurance benefit small businesses, and what factors influence the cost?
Commercial umbrella coverage supplements general liability, commercial auto, or employer’s liability insurance when their limits are maxed out. Its cost increases with more coverage.
What cost-saving strategies can small businesses use for their insurance coverage?
To save on insurance, small businesses can pay annually for discounts. They can also use strong risk management practices and reduce claims.
What are the different types of small business insurance policies and their average costs?
What factors affect the cost of general liability insurance for small businesses?
What factors influence the cost of commercial property insurance for small businesses?
How does business interruption insurance protect small businesses, and what factors affect its cost?
How is the cost of workers’ compensation insurance calculated for small businesses?
What factors influence the cost of commercial auto insurance for small businesses?
How does professional liability insurance protect small businesses, and what factors affect its cost?
What factors impact the cost of product liability insurance for small businesses?
How does cyber liability insurance protect small businesses, and what factors affect the cost?
How does commercial umbrella insurance benefit small businesses, and what factors influence the cost?
What cost-saving strategies can small businesses use for their insurance coverage?
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