Startup business insurance

Startup business insurance protects emerging companies from a variety of risks. It can be customized to different industries, products, services, and more. Choosing the right coverages provides important financial and legal protections while you build your business.

Discover what kinds of business insurance are best for startups and learn more about startup business insurance costs.

Why do startups need insurance?

Startups need insurance to safeguard their assets and support their business's long-term success. Coverage can minimize financial losses in case of unexpected events, such as property damage. Overall, it helps manage risks, cover liabilities, protect your operations, and provide peace of mind.

In some cases, business insurance for startups may be required. For example, startups might need it before signing a commercial lease or entering into contracts with customers. If you have a staff, you might also need to provide employee protections through workers' compensation.

Discuss your needs and risks with an insurance expert to make sure you're properly protected.

How much are startup business insurance costs?

Startup business insurance costs depend on your industry, coverage needs, location, and employees. Your business tenure can also affect your premium. Sometimes new companies have higher rates because they don't have any insurance history. The longer you are in business and the fewer claims you have, the lower your rates could be.

Get more information about business insurance costs, and start a quote to learn exactly what you'll pay.

Types of business insurance for startups

Startups can tailor insurance to their specific risks and exposures, with coverage recommendations varying based on business type. For example, insurance for tech startups might differ from insurance for a new retailer.

The following are common small business startup insurance coverages:

General liability

General liability insurance for startups covers lawsuits and claims related to your operations, such as injuries and property damage. It's the most popular business insurance coverage because it protects against diverse risks. If someone got hurt while interacting with your company, general liability could help.

Professional liability

Professional liability insurance covers mistakes you make when providing advice or services. This coverage is also called errors and omissions insurance. If a customer files a lawsuit claiming your negligence cost them money, professional liability would pay for your defense.

Business owners policy (BOP)

A business owners policy packages commercial property coverage with liability protection. In addition to covering the same type of claims as general liability, BOP protects against damage to commercial buildings, tools and equipment, and other business property. It can also include business interruption insurance to minimize losses if a covered emergency prevents you from operating.

Workers' compensation

If you have employees, your startup might need to carry workers' compensation insurance to protect them. This coverage pays for medical expenses and lost wages in case of workplace injuries and illnesses. Requirements vary based on location, so check business insurance requirements by state to see regulations where you live.

Cyber insurance

Cyber insurance covers claims related to data breaches and cyber attacks. Startups that process sensitive information, like credit card numbers, should consider this protection. It can help pay for data restoration and identity recovery, as well as customer claims if you're liable for the breach.

Learn more about best practices for keeping your business's data safe.

Commercial auto

Commercial auto insurance protects your vehicles against work-related accidents. It's a good choice for startups that rely on autos for their operations, such as a new landscaping company that uses a truck to carry tools to job sites.

How to get insurance for a startup business

Insuring your startup begins with assessing your company's needs and risks. You might want to start with one type of coverage and expand your policy as your organization grows. Having a plan from the beginning will help you manage budgets and ensure you have the proper protection so you can focus on building your new business.

If you're unsure about what coverages are best, speak with an insurance expert for guidance.

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