| Accidents happen all the time, and business owners need to be protected in case there’s an accident in the workplace—especially since the average customer injury insurance claim is for $35,000.1 It’s important for business owners not to leave themselves vulnerable, and to make sure they have the insurance they need to cover all of the risks present in their business. After all, not having the right types of insurance can be the same as not having it at all, leaving businesses with no protection against many types of losses. We compared more than a dozen of the country’s best insurance companies—as well as several brokers—based on the types of coverage they offer, the industries they serve, their ratings for financial stability, and customer satisfaction to identify those that best meet the needs of small businesses. Read on to see who has the best small business insurance that meets your needs. The 7 Best Small Business Insurance Companies of 2022 Best Overall: State Farm Best for Independent Contractors: Hiscox Best General Liability Insurance: Nationwide Best Workers’ Compensation: The Hartford Best Commercial Property Insurance: Travelers Best Business Owners Policy: Liberty Mutual Best Commercial Auto: Progressive Commercial Best Small Business Insurance Companies State Farm Hiscox Nationwide The Hartford Travelers Liberty Mutual Progressive Commercial Frequently Asked Questions What Insurance Do I Need For My Small Business? What Does Small Business Insurance Cover? What Is A Business Owners Policy (BOP)? What Does Small Business Insurance Exclude? What Is The Average Cost Of Small Business Insurance? Methodology BEST OVERALL State Farm State FarmGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 855-559-0218. Why We Chose It We chose State Farm as the best overall small business insurance company because it offers multiple types of coverage through a nationwide network of agents. What’s more, State Farm agents are business owners themselves, so they understand the needs of other small business owners. Pros & Cons Pros A nationwide network of agents Simple general liability offerings available in $1 million increments Several other types of coverage available, along with other endorsements and add-ons such as in-home business endorsements Cons Customer service won’t be consistent with every agent Many agents can’t write across state lines Overview State Farm was established in 1922 by G.J. Mecherle, a retired farmer and insurance salesman. Though best known for auto and home insurance, State Farm has about 100 products including financial services, banking, and commercial insurance. It has an A++ rating for financial stability from AM Best.2 State Farm sells insurance in most states and offers policies designed for each stage of a company’s growth cycle including general liability, professional liability, and other types of coverage that can be added onto policies to suit individual needs. State Farm also offers business insurance that is designed specifically for certain industries such as contractors, professional services, caterers and retailers. In addition to business coverage, State Farm offers discounts for policyholders who combine certain types of coverage, though discounts vary based on the types of coverage being bundled. The discounts are not for bundling business coverage. However, if you’re happy with your State Farm business coverage, you could get home and auto coverage from them and save. Every State Farm agency is independently owned, so every agent understands the unique needs of small business owners—they are business owners themselves. BEST FOR INDEPENDENT CONTRACTORS Hiscox HiscoxGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 888-486-1756. Why We Chose It Hiscox wins the top spot for independent contractors because they have products designed and priced specifically for independent contractors and freelancers. Pros & Cons Pros Huge international insurer Small business coverage in 49 states and Washington, D.C. Policies designed for micro-business needs Cons Only nine U.S. offices Parent company is not U.S.-based Small business coverage not available in Alaska Overview Hiscox was started in 1901 as an underwriter in Lloyd’s market. Although the parent company Hiscox Group is based in Bermuda, the U.S. corporate headquarters is in Atlanta, Georgia and operates in nine offices across the country. Hiscox does business in 14 countries and all 50 states, plus the District of Columbia, although it’s small business insurance is not available in Alaska. Hiscox offers a core lineup of business insurance products including commercial general liability, professional liability, business owners’ policies (BOPs), workers’ compensation, cyber liability, commercial auto, and employment practices liability insurance (EPLI). The company also writes all the business insurance policies sold by GEICO. Hiscox offers standard liability coverage limits up to $2 million, but higher limits are available upon underwriting approval. The company boasts coverage for many industries and policy types. Customized solutions are available for 180+ different industries including salons, fitness instructors, consultants, therapists, janitors, and acupuncturists. BEST GENERAL LIABILITY INSURANCE Nationwide NationwideGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 888-665-2658. Why We Chose It We chose Nationwide as our best general liability provider because the company is a business insurance carrier that focuses on simple, straightforward insurance solutions, which is ideal for businesses with high-risk, general liability needs. Nationwide also received an A++ Superior rating from AM Best for financial stability.3 Pros & Cons Pros 14 different industry specialties Also offers investment services A++ rating from AM Best Cons Coverage not available in Alaska or Hawaii Overview Nationwide traces its roots back to 1926 when it operated as Farm Bureau Mutual Automobile Insurance Company. The name was changed to Nationwide in 1955 during its efforts to expand coverage to all states from coast to coast. There are agents in every state except Hawaii and Alaska. In addition to general liability, Nationwide offers many types of business insurance including business property, commercial auto, BOP, workers’ compensation, EPLI, equipment breakdown coverage, and umbrella insurance. The company also has 14 different industry specialties including retailers, professional offices – including medical clinics, food & beverage businesses, and farms & ranches. BEST WORKERS’ COMPENSATION The Hartford The HartfordGET A QUOTE Why We Chose It We chose The Hartford as our top workers’ compensation provider because of the special benefits it offers employers such as pay-as-you-go plans. These plans drastically lower the chances of over- or under-paying premiums because costs are based on actual payroll instead of projections. Pros Second-largest provider of workers’ compensation insurance nationwide State- and city-specific insurance requirement guides Pay-as-you-go workers’ comp that reduces the risk of premium discrepancies Network of over a million healthcare providers to help injured workers Cons Unable to file business claims on the app Cumbersome application process Overview The Hartford was founded in 1810 as a fire insurance company. Since then, the company has grown into a Fortune 500 company that has served over a million small business customers. The Hartford, a Connecticut-based company, has an A+ (Superior) rating from AM Best.4 The Hartford offers many types of business insurance including general liability, BOPs, commercial auto, commercial flood, data breach coverage, commercial umbrella, business income, and professional liability coverage. The company also advertises more than 20 industry specialties including arborists, pet groomers, restaurants, printing, and publishing. In addition, The Hartford offers many other policyholder benefits including: Access to The Hartford’s Preferred Medical Provider Network with over a million healthcare providers Prescription drug features The Nursed Back to Health Program The Hartford is the second-largest provider of workers’ comp insurance nationwide.5 BEST COMMERCIAL PROPERTY INSURANCE Travelers TravelersGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 888-354-2875. Why We Chose It We chose Travelers as our best commercial property insurer because the company has developed extensive experience in the space, having been ranked the top commercial property insurance company in the United States by premiums written for multiple years and narrowly coming in second place in 2021.6 Pros & Cons Pros A++ rating from AM Best Number-two commercial property insurer in the U.S. by premiums written More than 40 industry specializations Cons Pricing and features are highly dependent on industry and operations Overview Travelers is another storied company with a history that stretches back to 1864, when one of its founders started writing accident insurance for two-cent premiums. The company as it’s known today was formed in 2004 with the merger of Travelers and St. Paul Companies and has an A++ rating from AM Best.7 Travelers has insurance solutions that are designed to meet the needs of companies in more than 40 industries including transportation, manufacturing, construction, retail, and public entities. However, the company has developed considerable expertise in commercial property insurance. In fact, the company writes so much property insurance that it ranked as the 2021 number-six writer of commercial property insurance in the United States, according to the Insurance Information Institute.6 The company offers other types of business insurance including commercial auto, cyber liability, surety bonds, and workers’ comp, although prices vary by industry. Because Travelers operates in the U.S., Canada, and the U.K., the company is well-suited to provide coverage for companies that do business internationally. BEST BUSINESS OWNERS POLICY Liberty Mutual Liberty MutualGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 888-509-2650. Why We Chose It We chose Liberty Mutual as the best insurer for BOPs because the company has a fast and easy process with a streamlined business owner’s policy available for many different industries that combine coverage in one cost-effective policy. Pros & Cons Pros Quick and easy claim process that can be filed online or through an app 24-hour claims assistance Cons Policies serviced by independent agents Overview We chose Liberty Mutual as our best provider of business owners policies (BOPs) that combine multiple types of coverage into a single policy protecting against liability, property loss, and loss of income. Liberty Mutual is in a unique position to help large numbers of business owners, regardless of industry. Liberty Mutual offers business insurance through independent agents across the country. The company has several types of coverage available including commercial auto, equipment breakdown, inland marine, umbrella coverage, and workers’ compensation, as well as 12 industry-specific solutions including construction, public entities, financial institutions, healthcare, real estate, and wholesale. Liberty Mutual also advertises 24-hour claims assistance through its nationwide contractor referral network. BEST COMMERCIAL AUTO Progressive Commercial Progressive CommercialGET A QUOTE For the fastest quote experience, call CommercialInsurance.net at 888-528-4310. Why We Chose It We chose Progressive as our best insurer for commercial auto insurance because it is the largest specialist in this space and knows how to handle business auto claims better than anyone. Pros & Cons Pros Discount on commercial auto when combined with general liability or a business owners policy Top commercial auto insurer in the country Trucking insurance available in all 50 states Cons Discounts aren’t available in all states Overview Progressive was founded in 1937 and is the biggest commercial auto insurer in the United States.6 While commercial auto is one of Progressive’s major areas of focus, the company also offers other types of business insurance including general liability, workers’ compensation, BOPs, professional liability, and cyber insurance. Progressive has specially designed insurance solutions for 61 industries and professions including gyms, yoga instructors, auto mechanics, painters, beauty salons, and many more. Progressive offers a discount on commercial auto coverage when your business has general liability coverage or a BOP in force, even if the general liability or business owners policy is through a different carrier. Business owners can also save up to 15% for paying annual premiums in full upfront. Frequently Asked Questions What Insurance Do I Need for My Small Business? The insurance that you need for your small business depends on what type of business you have and your specific risks. However, almost all businesses need general liability insurance, which protects you in case a customer gets hurt at your place of business. Some other types of small business insurance that you may need include: Commercial property insurance if you own or lease property for your business Workers’ compensation insurance if you have employees Professional liability, also called errors and omissions (E&O), for professional service providers such as an architect, accountant, consultant, or lawyer Commercial auto insurance if you use vehicles for business purposes (other than commuting) Inland marine insurance if you transport inventory or equipment In addition to these core types of business insurance, there are many other types of coverage that business owners may need to cover risks, such as cyber insurance or employers’ professional liability insurance, that are specific to the company or its industry. What Does Small Business Insurance Cover? Small business insurance is designed to provide financial protection to a business and its business owners if there’s an accident involving the business’s owner, employees, customers, or property. The average claim for customer injury or property damage is about $35,000. In cases where a claim leads to a lawsuit, a general liability claim can cost $75,000 or more to defend and settle.1 The specific risks covered by small business insurance depend on the types of coverage you buy: Commercial general liability insurance covers accidents or injuries to your customers or other members of the public at your place of business. Business property insurance covers damage to your business’s facilities, equipment, or inventory that result from a qualifying event. Workers’ compensation insurance covers work-related accidents or injuries to employees while they’re on the job. In addition to these core coverages, professional liability insurance protects small business owners against claims arising from poor guidance that they give to clients. Commercial auto insurance covers damages resulting from a car accident caused by you or one of your employees when using a vehicle for business purposes. Damage to inventory or equipment when it’s in transit is covered by inland marine insurance. What Is a Business Owners Policy (BOP)? A business owners policy (BOP) is a policy that combines multiple types of business insurance in a single policy. Most BOPs include commercial general liability and property coverage, as well as small amounts of coverage for endorsements such as inland marine or umbrella coverage. By combining these coverages into a single policy, business owners are usually able to save money on their total premiums. One important thing for business owners to remember about BOPs is that, while they include multiple types of insurance, each coverage included in a BOP usually has its own limits, deductibles, and exclusions. What Does Small Business Insurance Exclude? While small business insurance protects your company against legitimate losses, it doesn’t protect against damages caused by your negligence or fraud. It also may not cover you if you misrepresent the nature of your business or misclassify your employees in order to reduce premiums. Most policies, especially commercial property, also don’t protect business owners from losses resulting from natural disasters like floods, earthquakes, or hurricanes, unless coverage is specially added to protect against these events. For businesses that have multiple policies or several coverages combined in a BOP, coverage limits aren’t fungible; if a business has a loss for which they have low coverage limits, a business owner can’t borrow additional coverage from other parts of the policy unless their policy explicitly allows it. Individual coverages also have specific exclusions. For example, while workers’ comp protects employees in the event of workplace accidents, they typically don’t cover accidents that result from horseplay. Similarly, commercial auto insurance doesn’t provide coverage when a business vehicle is being used for non-business purposes at the time of an accident. Business interruption insurance will help replace lost revenue for a business in certain circumstances, but may not replace all lost income. Some policies require business owners to pay co-insurance or only replace income for the first three to 18 months of interruption. What Is the Average Cost of Small Business Insurance? Small business insurance costs vary widely based on industry, location, and coverage types. However, business owners who own facilities or equipment, have employees, or give professional advice should all expect to pay more each year in order to protect against their specific risks. Costs can also be higher for business owners who choose higher coverage limits, lower deductibles, additional coverages, or extra endorsements. Methodology To identify the best small business insurance companies, we looked at over a dozen national and regional insurance companies, as well as several online brokers. We chose not to include brokers on our list because we found multiple cases where business owners can qualify for discounts and other savings, as well as customized coverage for their business, by working directly with carriers. Business owners need an insurance company that they can partner with as they grow. They need insurance that’s easy to find, buy, and understand. To build our list, we focused on companies that make coverage widely available and that have strong ratings for financial stability and customer satisfaction. We also considered the types of coverage that companies offer and the industries they specialize in. |
