Average Insurance Cost For Small Business - Building size, equipment cost, and other factors determine the cost of property insurance (also called hazard insurance). Small businesses pay about $67 per month for this policy.
Regardless of policy limits, customers pay an average of $67 in premiums for commercial property insurance, or about $800 per year. Nearly two-thirds (62%) of customers purchase insurance for $100 or less.
Average Insurance Cost For Small Business
Our data is derived from the average price of customers purchasing policies. Because the median excludes unusually high and low premiums, it gives a better estimate of what your business can afford.
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While small business customers pay an average of $67 per month for commercial property insurance, 35% of customers pay less than $50 per month and 27% pay between $50 and $100 per month. Costs for small businesses vary based on their risks and insurance coverage chosen.
Our analysis of commercial property insurance costs shows that for small businesses, your industry has the biggest impact on your premiums. In general, insurance companies charge higher premiums for high-risk industries, while lower-risk industries use lower rates.
For example, real estate professionals who work in the public face more risk than IT consultants who work from home. The chart below shows how the type of business affects the amount you pay for commercial property insurance.
Depending on your industry (such as sports and fitness), landlords may require you to purchase commercial property insurance to rent the space.
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For other businesses, such as the insurance or healthcare industry, you may need professional liability insurance (also called errors and omissions insurance) to get a license.
The policy limits and deductibles you choose will affect the cost of your commercial property insurance. In general, the higher your limits, the more expensive your premiums will be.
Many policyholders combine commercial property insurance with general liability coverage called a business owners policy (BOP). A BOP is usually cheaper than buying each policy individually.
High-risk small and medium businesses are recommended to purchase a Commercial Package Policy (CPP), which combines commercial property and general liability coverage, but offers more coverage options than BOP.
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General liability insurance with limits of $1M/$2M is the most popular option for small businesses. This includes:
Almost all customers (91%) choose policies with $1 million/$2 million limits. 5% of our customers choose policies with $2M/$4M limits, the second most popular option.
The discount you choose is another factor that affects the cost of commercial property insurance. You can save on your property insurance by choosing higher deductibles or lower limits. The average deductible chosen by commercial property insurance customers is $1,000.
Industry and policy limits are just a few of the factors mentioned that can affect commercial property insurance rates.
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Geolocation can help your provider determine what environmental risks your business may be exposed to, such as natural disasters such as floods or tornadoes. Land values and local laws also affect the premium you pay.
Is your business located in a high crime area? Does your business have toxic materials or engage in hazardous activities such as mining? Are there lax security measures that fail to protect your physical assets and encourage vandalism?
These are higher risks and can affect insurance rates. If you handle toxic materials, it may be a good idea to purchase environmental insurance that covers liability for pollution risks.
Properties with easy access to fire stations and hydrants may have lower insurance costs. Sprinkler systems and fire alarms can also help reduce insurance costs.
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Older buildings may be more susceptible to certain types of property damage, so insurance costs may be higher. For example, a fire caused by old electrical wiring can result in expensive repairs.
If your equipment is difficult to repair due to a lack of parts or is more likely to break down due to frequent use, you may have to pay a higher premium. Plus, repairing old equipment can be cheaper than buying the latest technology.
If you own equipment that you take from one job site to another, you may need inland marine insurance or contractor's tool and equipment insurance. These policies protect your tools and other property during transport.
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Replacement value insurance is more expensive than actual cash value insurance. The former covers the replacement cost of the new item and the latter covers the depreciated value of the item.
Policies that cover disclosed risks cost more than policies that cover named risks. Open risk insurance covers all losses except those specifically excluded in the policy. Named peril insurance covers only the losses listed in the policy.
You can save on commercial property insurance by limiting your property damage risk and comparing insurance quotes from different providers.
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Fill out a simple online application today and you can compare free quotes on commercial property insurance and other types of insurance from America's top insurance companies.
Once you've found the right policy for your small business, you can begin coverage and get certified for your small business within 24 hours.
Insurance premiums vary depending on the policy purchased by the business. See our small business insurance cost overview or learn about the cost of specific coverage. For many small businesses with few or no properly insured employees, the cost of small business insurance can range from $500 to $1,000. It costs only $41-$83 per month. But it really depends on your situation. We have some sample prices based on industry and type of coverage, but it's important to know that these are only general estimates. There are many factors that affect the cost of commercial insurance.
If you are a small business owner, you will obviously pay less for business insurance than a larger company. The main reason is that you face less risk. The level of risk you face is a major factor in the annual cost of insurance. As you grow, your needs will adapt and change. And the cost can be higher.
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Here's an example of the median premiums our policyholders paid for coverage last year.
Here are some examples of the average costs our policyholders paid for their coverage last year.
The price depends on the type of policy you need. This is because each type of policy covers specific risks. This is included in the price of the policy. But you can't expect to pay the average or average rate either. Many factors play a role here. The most important factors are your occupation, the number of employees and your insurance needs.
But there are other factors, such as having a claim history or needing higher coverage. Even within the same industry, business insurance costs vary widely between businesses. The best way to find out how much your insurance will cost is to get a quote to get the exact price you should pay.
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There are fewer responsibilities when you work alone. As you begin to bring additional workers into your operations, the potential for error increases. That's why certain types of insurance, such as workers' compensation and general liability insurance, have policy rates based on wages. The higher your salary, the higher your insurance costs.
Smaller companies typically pay less for insurance than larger companies because they face less risk. In general, the higher your income, the higher your risk. Some insurance policies, such as liability insurance, are based in part on your sales.
This makes sense because the more money you make, the more you lose. The more you lose, the more coverage you need. Simply put, more income = more coverage = higher policy prices.
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Cheaper business insurance is often available in low-risk industries. For example, a home-based consultant will pay less for general liability insurance than a florist or retailer. An artist (who faces more physical risks) will pay more workers' compensation than a virtual assistant.
Commercial property insurance and liability insurance prices vary by state and zip code. For example, property prices in rural areas may be higher than in urban areas. One reason is that fire departments or fire hydrants are not easily accessible.
However, stores in urban areas may charge more for liability insurance. This is because their location gets more foot traffic than a rural grocery store. more feet
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