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Small Business Insurance 2021

Money.com logo Money.com 7/22/2021 Ana Reina, Norma Rodríguez and Gabriel Rodriguez
icon: Best-2021-Small-Business-Insurance © Money; Getty Images Best-2021-Small-Business-Insurance

Business insurance can help pay the costs of property damage, lost business income, lawsuits, and other specific risks of running a business. General liability coverage is recommended for all businesses, but your business insurance needs will vary depending on several factors, including number of employees, location, and industry.

Find the right coverage for you by taking a look at the best small business insurance companies of 2021.

Our Top Picks for the Best Small Business Insurance Companies

  • The Hartford – Best Comprehensive Option
  • Nationwide – Best for General Liability Insurance
  • State Farm – Best for Commercial Liability Insurance
  • Progressive – Best for Commercial Auto Insurance
  • CyberPolicy – Best Business Insurance Marketplace
  • Thimble – Best for Micro Businesses
  • Liberty Mutual – Best Umbrella Insurance

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Best Small Business Insurance Reviews

The Hartford – Best Comprehensive Option

Pros
  • Provides workers' compensation insurance nationwide
  • Discount for bundling policies
  • Online quotes for 51 professions across 24 industries

Cons
  • No coverage in Alaska or Hawaii
  • Can't file business claims on the app
  • No live chat support

The Hartford stands out for its comprehensive Business Owner’s Policy (BOP), a three-in-one policy that combines general business liability insurance, business property insurance, and business income insurance. The BOP also includes protection from loss of income caused by fires, destructive winds or burglaries, bodily injury or property, and personal and advertising injury.

Besides the Business Owner’s Policy, Hartford also offers:

  • Workers’ compensation insurance
  • Business auto insurance
  • Professional liability insurance

With Hartford, small business owners can buy add-ons to cover unique risks such as data breach insurance, business auto insurance, debris removal, and the loss of valuable paper records.

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Nationwide – Best for General Liability Insurance

Pros
  • BOP insurance for businesses with annual revenue of up to $5 million
  • Business Solution Center offers cybersecurity advice and social media guides

Cons
  • No disability insurance or major medical insurance
  • No online chat support

Nationwide offers a wide array of products for small business owners including, business liability, commercial property, commercial auto insurance policies, and worker’s compensation insurance. The company stands out for its flexible general liability coverage, which can be added to its other business insurance products.

Business owners can also supplement its general liability insurance with additional coverage, including fire legal liability and employment-related practices liability.

Other coverages offered:

  • Cyber liability
  • Equipment breakdown
  • Accounts receivable

With Nationwide, you can include add-ons in your coverage for commercial crime, business income, inland marine, and builder’s risk, among others.

StateFarm – Best for Commercial Liability Insurance

Pros
  • Insures more than 300 professions
  • Highly customizable insurance policies
  • Live chat support

Cons
  • Not all insurance agents can cross state lines
  • Claims are filed over the phone, not online

With StateFarm’s Commercial Liability Umbrella Policy, you can add extra coverage to fit your business needs. The company’s extra coverage includes professional liability, errors and omissions liability, employment practices liability insurance (EPLI), Not-for-Profit liability insurance with EPLI, and Condo and Homeowners Association Directors and Officers Liability with EPLI.

Other coverage offered:

  • Business Owners Policy
  • Commercial Auto
  • Workers Comp
  • Health and Life Insurance
  • Retirement Plans

StateFarm also offers business insurance designed for independent contractors, restaurants, professional services, and retailers, with paperless billing and autopay options. They also have a handy business insurance directory with a complete list of the types of businesses and organizations they insure.

Progressive – Best for Commercial Auto Insurance

Pros
  • Second-largest business auto insurer in America
  • Discount for bundling multiple business insurance policies
  • Policies cover a wide variety of risks and vehicle types

Cons
  • No online support via live chat
  • Discounts are not available in all states

Progressive shines in its commercial auto coverage offerings. Their policy typically includes liability, physical damages, medical payments, uninsured motorist, hired auto, and non-owned coverage. The company insures commercial trucks, business cars, emergency vehicles, military vehicles, and a variety of SUVs, vans, trucks, buses, tractors, and trailers.

Progressive also offers business owners coverage for general liability, professional liability, worker’s compensation, BOP, health insurance, and cyber insurance.

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CyberPolicy – Best Business Insurance Marketplace

Pros
  • Discounts for bundling multiple policies with the same carrier or cross carrier
  • Compare multiple quotes, starting at $10/mo, while you shop
  • Apply and submit claims online; coverage begins within 24 hours

Cons
  • Nationwide availability, but policies vary by state
  • Claims must be submitted directly through the provider's claims department, not through CyberPolicy

CyberPolicy is a small business insurance policy marketplace that partners with some of the most prominent industry players Chubb, Hiscox, Liberty Mutual, Nationwide, and BiBERK to provide a convenient, one-stop shopping experience. The company offers free quotes, and once you purchase a policy, coverage starts within as little as 24 hours.

Other coverages offered:

  • Fidelity and crime
  • Employment practices liability
  • Lessor’s risk only (LRO)
  • Liquor liability

CyberPolicy’s customer service includes a licensed insurance advisor available via chat to help you decide on the best commercial insurance options for your business.

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Thimble – Best for Micro Businesses

Pros
  • Flexible policy terms with weekly, daily, or even hourly coverage
  • Certificate of Insurance in 60 seconds
  • Over 100 types of small businesses insured

Cons
  • No business interruption or commercial property insurance
  • No options to call or chat
  • Policies not available in NY or WA

Thimble provides affordable monthly and on-demand general and professional liability insurance policies for small business and self-employed individuals ranging from freelancers, personal trainers, pet sitters, event organizers, photographers, landscapers, beauty professionals, and everyone in between.

Micro businesses — small businesses that employ fewer than 10 people — can especially benefit from Thimble’s flexible terms like letting you buy a policy for as long as you need, as well as the possibility to extend, modify, or cancel your policy right from the Thimble app.

Other coverages offered:

  • Drone insurance
  • Event insurance (coming soon)

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Liberty Mutual – Best Umbrella Insurance

Pros
  • File claims online or with the mobile app
  • 24-hours claims assistance
  • Crisis management support services

Cons
  • Policies served by independent agents

Liberty Mutual’s umbrella insurance provides additional liability coverage beyond the limits of existing policies, including auto, watercraft, and homeowners insurance. Policies start at $1 million in excess liability coverage, with up to 25 million in lead umbrella and up to 100 million in excess capacity. The company’s umbrella insurance also includes crisis management support services that can provide up to $250,000 in consulting expenses to help steer media coverage and public relations.

Regarding customer service, Liberty’s specialized underwriters are trained to understand complex risks across a variety of industries, and their dedicated complex liability claims unit is experienced in navigating catastrophic losses.

Other Companies We Considered

The following companies did not make it to our top list but are still worth considering.

Hiscox

Pros
  • Long-standing provider of business insurance with nearly 120 years of experience
  • Wide range of policies tailored for smaller companies

Cons
  • Some insurance products are not available for online quotes and purchases
  • Coverage not available in Alaska

Hiscox offers a wide variety of policy options best-tailored for self-employed or small businesses that employ less than five employees.

Geico

Pros
  • No cancellation fees and prorated refunds if you cancel a policy
  • Live chat support and online access

Cons
  • Many of their products are offered through a partnership with Hiscox
  • Commercial auto insurance doesn't cover semi-trucks and tractor-trailers

Geico’s business insurance products include commercial auto, rideshare, general liability, professional liability, a business owner’s policy, and workers’ compensation. Its experience with auto insurance makes it a good choice for commercial auto coverage and rideshare coverage. However, these two products are some of their most expensive and lack online claim filing.

CNA

Pros
  • Solid financial strength ratings with over 100 years of experience in the industry
  • Cyber liability and media liability coverage

Cons
  • Negative customer feedback online
  • Dated online experience

Another well-established carrier, CNA has been around since 1897 when they began offering coverage to railroad industry employees. The company features a wide variety of insurance types for businesses of several sizes and excels in offering fidelity and commercial crime business solutions and inland & ocean marine insurance.

CoverWallet

Pros
  • Get quotes, make purchases, and manage your policies with the Digital Wallet
  • Guide to commercial insurance by state

Cons
  • Quotes can take a while to generate

CoverWallet offers all standard business insurance types, including general liability, product liability, worker’s compensation, and business owner’s policies. However, the company is an insurance broker, not a provider, so it does not underwrite any of its policies, instead, it uses deep analytics and a proprietary algorithm to provide users with affordable quotes.

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Embroker

Pros
  • Specialized coverage for startups
  • 24/7 customer support via phone, email, or live chat

Cons
  • No information about the claims process
  • As a younger company, it lacks the financial background of older carriers

Embroker is a digitally native insurance company that uses the latest technology, from machine learning to artificial intelligence, to make policies more affordable and easier to purchase. The company is a good choice for lawyers and law firms, for which Embroker has special coverage packages.

Travelers

Pros
  • One of the oldest insurance companies in the country, with outstanding financial strength ratings
  • Large network of local insurance agents across the country

Cons
  • Coverage option availability varies by state

Travelers is another large and well-established insurance company with a wide variety of business insurance products. Its vast network of agents is a highlight of the company, but none of its individual business insurance products stood out from those on our top list.

Chubb

Pros
  • Offers both general business insurance products and highly specific solutions for a number of industries
  • Outstanding customer satisfaction ratings

Cons
  • Lack of transparency regarding rates
  • No online quotes or buying a policy online

Chubb has been in the business insurance industry for almost 140 years. The company enjoys excellent financial strength ratings, and its products are very well-received by most of its policyholders. Chubb has products for a vast number of industries, making it ideal if you’re looking for very specific types of coverage instead of just general business insurance.

Mylo

Pros
  • Intuitive online marketplace partnered with over 100 high-rated carriers
  • Expert agents licensed in all 50 states

Cons
  • Not much information about the company, despite being well-known in the industry

Mylo is an award-winning digital agency that uses an AI-powered recommendation engine to recommend business insurance coverage and products to save you money and protect the future of your business.

Simply Business

Pros
  • Simple to use platform with a wealth of industry-specific resources
  • Partnered with reputable carriers such as Axis, Harborway, and Travelers

Cons
  • Customer service helpline has limited opening hours that change daily

By filling out Simply Business’ online form, users can get coverage suggestions and quotes from the company’s insurance partners in under 10 minutes. The site is a good choice for those who would like to quickly compare quotes side-by-side or who still don’t know the type of coverage they should be getting.

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Business Insurance Guide

Business insurance offers financial protection against losses due to events that may happen during the regular course of business, such as natural disasters, fires, accidents, lawsuits, and death. Going without business insurance comes with high risks. A claim lodged against your uninsured business could eventually lead to a legal seizure of assets, leaving you unable to pay your employees or suppliers.

If your business is in need of financial help, check our selection of the best small business loans of 2021.

How Does Business Insurance Work?

Business insurance works similarly to other types of insurance. In exchange for agreeing to share their business’s risks, clients pay a monthly premium to an insurance carrier. The business can then file a claim with the insurance company in case of a financial loss, for example, if a fire or flood destroys a portion of the business premises.

Once a claim is processed and the damages are assessed, the insurance company disburses the appropriate amount of compensation for the loss. How exactly a claim is processed will depend on the scale of the claim and the type of policy.

Types of Small Business Insurance

Business insurance companies offer a wide variety of products, which broadly fit into one of two categories: property insurance and casualty insurance. Some of these products are sold as individual policy types, whereas others can be added to existing policies as add-ons. Some are even required for all businesses by federal or state law.

Type of Business Insurance Coverage Covers Average Monthly Premium Best for Businesses…
General Liability Insurance Claims or lawsuits against a business due to bodily injury, property damage, medical expenses, death, slander, libel ~$50 Of any kind
Product Liability Insurance Financial loss and the cost of legal fees as a result of a defective product ~$100 That manufacture, wholesale, distribute, and retail a product
Professional Liability Insurance (sometimes called Errors and Omissions Insurance) Financial loss and the cost of legal fees as a result of mistakes in the professional services you provide ~$60 Provide services directly to clients and/or customers
Commercial Property Insurance (also known as Hazard Insurance) Loss of or damage to a business’ possessions, e.g. tools, equipment, inventory, furniture, valuable documents, outdoor landscaping ~$85 With a significant amount of property and physical assets
Commercial Auto Insurance Bodily injury or property damage caused by vehicles owned by a business ~$85 That own, lease, or rent vehicles, or that have employees driving their own cars for their job
Cyber Liability Insurance Expenses resulting data breaches, cyberattacks, and other cyber events, e.g. direct financial losses, customer loss, and legal costs ~$90 That are top targets for cyberattacks (e.g. online retailers, online service companies, fintech companies, insurance services, etc.)
Business Owner’s Policy (BOP) A mix of coverage options based on the items in the package, e.g. property damage, lost income, liability claims ~$100; varies based on coverage included in the package Of any kind that needs comprehensive coverage
Business Interruption Insurance Financial loss due to events (i.e. covered perils) that cause a disruption to the normal course of business ~$100 That require a physical location to do business
Umbrella Insurance Catastrophic events that result in unusually high losses beyond the scope of standard liability insurance ~$85 That face costly liability risks which could exceed their primary policy limits
Key-Person Coverage Financial impact from losing the owner or another key person to death or disability Varies based on the industry and covered employee With one or more vital employees whose death or disability would significantly affect the company’s finances
Malpractice Insurance Attorneys’ fees and court costs, arbitration costs, settlement costs, punitive and compensatory damages, and medical damages resulting in a patient’s injury or death ~$625 That employ medical professionals (healthcare professionals)
Worker’s Compensation Medical care, medical expenses, lost wages due to recovery time, disability benefits, and funeral expenses for employees ~$40 (per employee) That require employees to function
Disability Insurance A portion of lost income for employees who suffer from an illness or injury outside of work ~$150 That require employees to function
Employment Practices Liability Insurance (EPLI) Costs associated with an employee filing a lawsuit against your business, e.g. for discrimination, wrongful termination, or sexual harassment ~$125 That have employees

Keep in mind that the products on this table represent only a portion of the types of business insurance that carriers offer to consumers. There are many other highly specialized types of coverage designed to cover the unique needs of specific industries, such as agriculture, aerospace, real estate, and even wineries.

How Do You Choose the Right Business Insurance Policy?

As with buying personal insurance, spending a little time planning your business coverage upfront can pay off handsomely. These steps can save you time and money when comparing business insurance online.

Take stock of business assets

Make a list of what the business owns, including property, equipment, and inventory. Then, determine the value of those assets to ensure you will buy sufficient coverage to repair or replace them if the worst happens.

Figure out how much coverage you need

List all the functions and activities of your business, then assess the coverage you think is needed for each, based on its respective risk.

Seek professional help, in part to research insurance companies

The coverage assessment we describe above is best completed with the help of an insurance professional. Seek an independent agent or marketplace specializing in business insurance and who represents a variety of insurers.

Compare quotes

The policies you compare should have the same, or similar, exclusions, deductibles, and coverage limits. An agent or marketplace site you’re working with will be able to provide business insurance quotes from the companies they represent. Consider supplementing those with quotes from companies you reach out to yourself — including some of those on our list.

Look for policy bundling discounts

Many insurance companies offer discounted prices when you purchase multiple policies. In addition to the financial advantages, bundling coverage can reduce the time and hassle required to pay premiums, contact customer service, or make claims.

Review your business insurance regularly

Reviewing your business insurance coverage gives you a chance to assess how you’ve used your coverage in the past and if you need to increase or lower it. You may be able to drop coverage limits or increase deductibles, saving money on premiums.

Along with annual reviews, try to re-evaluate your business’s level and types of coverage whenever business needs or circumstances change.

What Do You Need to Take Out a Business Insurance Policy?

The information and documents you need to take out a business insurance policy will vary based on the type policy or policies you want to purchase. Nonetheless, you will generally want to have the following on-hand:

  • Business location, name, and partners
  • Business registration and incorporation documents
  • Record of business assets and liabilities
  • Bank information (if you don’t have a separate checking account for your business already, we recommend you take a look at the best business checking accounts of 2021)
  • Number of employees, if applicable
  • Basic contact information for yourself and the company
  • Health and safety policy documents
  • Professional certificates, if applicable
  • An estimate of your business’s revenue for the upcoming year
  • Details about business operations and occupational hazards (For example, handling dangerous chemicals, performing onsite installations for clients, etc.)
  • Details of company vehicles and driver’s information (for commercial auto insurance)
  • Insurance history, including existing insurance policy or policies and prior claims

Best Small Business Insurance FAQ

How much is business insurance?

Small business insurance pricing depends on the coverage you need. The average small business insurance costs approximately $46-$125 monthly or $552-$1,500 per year.

What is the best insurance for a small business?

The right insurance for your business will depend on the professional services you provide and the type of coverage you need. It is recommended that small companies have at least a Business Owner's Policy (BOP), including property coverage and protection against liability, peril, and business interruption.

What is the cheapest small business insurance?

From the companies we researched, Thimble offers the cheapest small business insurance starting at approximately $42 per month.

Do I need insurance for my LLC?

Yes, you should purchase insurance if your business is an LLC. An LLC protects your assets from being attached to your business, but if you don't have a general liability policy and an accident happens, your business is liable for the costs associated with the accident that took place.

How We Chose the Best Business Insurance Companies

To select the best small business insurance providers for 2021, we emphasized three major factors in making our selections:

  • Range of coverage options
  • Business types and sizes covered
  • The ease of applying for a policy and submitting a claim

Summary of Money’s Best Small Business Insurance of 2021

  • The Hartford – Best Comprehensive Option
  • Nationwide – Best for General Liability Insurance
  • State Farm – Best for Commercial Liability Insurance
  • Progressive – Best for Commercial Auto Insurance
  • CyberPolicy – Best Business Insurance Marketplace
  • Thimble – Best for Micro Businesses
  • Liberty Mutual – Best Umbrella Insurance

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This article originally appeared on Money.com and may contain affiliate links for which Money receives compensation. Opinions expressed in this article are the author's alone, not those of a third-party entity, and have not been reviewed, approved, or otherwise endorsed. Offers may be subject to change without notice. For more information, read Money’s full disclaimer.

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