How much does business insurance cost?

In 2021, the median monthly cost of a business insurance policy for new Progressive customers ranged from $42 for professional liability to $68 for a business owners policy (BOP). Learn what factors influence your cost and get a free quote today.

Business Insurance Policy

Median Cost

Average Cost

General Liability $48/month $65/month
Business Owners Policy (BOP) $68/month $101/month
Workers' Compensation $65/month $111/month
Professional Liability $42/month $56/month

Notice how the cost depends on the type of policy you need. Each policy protects against specific types of risk, and these differences are factored into the price.

So, can you expect to pay the median or average rate? Not necessarily.

Insurers calculate the cost of your policy using several basic factors, including your profession, number of employees and coverage needs. You can expect to pay above the average rate if you require more coverage, lease a unique property or have a claims history. Learning how these factors influence your premium can help you secure the best combination of price and protection for your situation. Call us now, or begin a quote online.

Factors that affect your business insurance costs

Many factors play a role in calculating your business insurance cost. The most influential factors are usually your profession, number of employees and coverage needs. These factors can vary significantly from business to business.

Profession

Not all business types carry the same amount of risk. A business type known to have higher risk can expect to pay more than a business with lower risk. Tree trimmers and contractors are examples of higher risk businesses. Their work is physical and often includes using power tools on other peoples’ properties. These factors increase exposure.

In contrast, a home-based financial advisor doesn’t share these risks, so they won’t be factored into their rate. Will they pay less? Probably, but not for certain. Professional services are exposed to different types of risk, and they often need carry professional liability insurance to stay safe.

Number of employees

Businesses with several employees can expect to pay more for insurance because their potential for claims is higher than a business with fewer, or no, employees. Each additional employee increases exposure to accidents and other mishaps that may result in a claim.

If a business has employees, it needs to carry workers' compensation coverage. This is required by law in almost every state, and it adds to the cost of insuring your business.

Coverage needs

The amount of coverage you select has an impact on your premium. For example, a $1 million/$2 million policy will generally cost more than a $1 million/$1 million policy.

These coverage levels typically can be adjusted to meet your specific needs, and they affect your final rate.

These three factors represent the basics, and every small business owner should be familiar with them. Of course, there are other factors that can affect your business insurance costs, including:

  • Property
  • Equipment
  • Location
  • Time in business

There’s a lot to consider when insuring your business, but getting help is easy. Just try to make sure you talk to someone with experience in insuring small businesses. Learn which business insurance coverages you might want to consider for your business.

Getting the cheapest business insurance

Finding the cheapest business insurance policy is a priority for the cost-conscious business owner, but always weigh the price against the coverage. You don’t want to pay for coverages you don’t need, but you also don’t want to be underinsured if something happens. Seek balance.

To help maximize your savings, analyze your business first to understand your specific needs. Be sure to include any contractual requirements and rule out any inapplicable coverages. Be informed.

You can save money by adjusting your deductibles. A deductible is the amount you pay out of pocket toward a covered loss at the time of a claim. Generally, the higher your deductible, the lower the cost of your annual premium. Just be sure you’re comfortable paying the deductible you select.

Help take the guesswork out of finding your best small business insurance cost and coverage combination by speaking with a licensed professional. They can walk you through the process and customize a quote specifically for your business. Call us today, or start a quote online. It’s that simple.

More information

Carpenter with business insurance measures a piece of wood in a workshop

Learn your business insurance cost by starting a quote today

Get a quoteOr, call 1-888-806-9598