Best Small Business Insurance of 2022

Running a business entails a wide range of tasks, and buying small business insurance is one of the most important. Small business insurance can help protect owners in case of unforeseen incidents, from a fire destroying inventory to an employee being injured on the job. Below, we have our rating of the Best Small Business Insurance Companies of 2022. We’ve also compiled information on how to find the best small business insurance company for you.

According to the Small Business Administration, all businesses with employees are required to have workers’ compensation insurance. So, if your small business has even one employee, you will be required to carry some sort of workers’ compensation insurance. Your state may provide exemptions and also regulate who is considered an employee for the purposes of determining workers’ compensation requirements. We’ve compiled a list of the Best Workers’ Compensation Insurance Companies of 2022 to help narrow your search for the best workers’ compensation policy for your business.

Choosing the right small business insurance company can be confusing. Here are some tips to start your search.

There is a wide variety of business insurance policies out there. You can find coverage for everything from general liability to kidnapping and ransom insurance. These are some of the more common types of insurance available:

Workers’ compensation insurance provides coverage in case an employee is injured on the job. If that happens, the policy will provide coverage for medical bills, disability, and lost income. The Small Business Administration (SBA) says that this coverage is required for all companies with at least one employee.

General liability insurance provides coverage against things like:

This policy may cover other types of risks as well, so read your policy to know what exactly this will provider coverage for.

Professional liability insurance, sometimes referred to as Errors and Omissions (E&O), provides coverage for financial damages as a result of a mistake your company makes. Examples include professional negligence and failure to meet standards of service.

Commercial auto insurance, also known as a business auto policy (BAP), provides insurance for the vehicles your business uses. This policy may or may not cover your private vehicle if you use it for your business, so check your policy for clarification. Commercial auto policies will typically cover auto liability and auto physical damages coverages.

Commercial property insurance is sometimes referred to as business property insurance. It is similar to a homeowners insurance policy in that it provides coverage for the physical structure of the building where your business is located, as well as its contents. This can include everything from inventory to furniture and even your documents. If your business suffers property damage from a covered loss such as a fire, this is when a commercial property policy would come into play. Also like a homeowners policy, you can often choose between actual cash value and replacement cost to assess the value of covered property.

Equipment breakdown insurance is specifically for equipment that you use in your business. This could be a computer in a law office or a stove in a restaurant. It provides coverage either to repair or to replace the broken equipment. It will also sometimes cover damage to property caused by the equipment breaking down.

A business owner policy (BOP) doesn’t provide a single type of coverage, but instead combines several different coverages into one policy. BOP typically includes both liability and property coverage in a single policy. Depending on the insurance company, it may also include other types of coverage such as business interruption or continuation coverage. Another benefit for small business owners is that a BOP can save money over purchasing the policies separately.

But a BOP may not be the only insurance policy a small business needs, as it generally doesn’t include commercial auto or workers’ compensation coverages.

Because there is a wide variety of factors that go into determining the cost of business insurance premiums and insurance companies may have different underwriting processes to determine a small business’s level of risk, it can be difficult to provide a definitive answer as to the cost of premiums. Here are some of the factors that go into determining how much your business will pay in premiums for insurance coverage:

This is not intended to be a comprehensive list of factors that determine premiums, but instead a place to start in helping you understand what goes into determining insurance premiums for business insurance coverage.

Depending on the type of company you own and what state you live in, business insurance may be required. For example, the Small Business Administration (SBA) states that if a business has employees, then workers’ compensation, disability, and unemployment insurance are required by the federal government. But, states can provide exemptions and may regulate who counts as an employee for the purposes of determining whether workers’ compensation insurance is required for your business. Check with your state’s department of insurance to determine what coverage is required.

Regardless of the state and federal government requirements, your landlord may also have business insurance requirements if you’re leasing space.

The types of coverage your business needs will depend on a number of factors, including any requirements from the federal and state governments, as well as your landlord. You should check with your insurance company, agent, or broker for more information.

This will be based on a number of factors such as:

These are just a few examples of items that can affect the amount of coverage you require. For more information, check with your insurance agent, broker, or company, as they should be able to offer guidance specifically tailored for your business.

Here are some steps to take in purchasing insurance for your small business:

1. Assess your business’s risks. According to the Insurance Information Institute (iii), one of the first things you’ll want to do is assess your risks. This can take the form of asking questions about how your business operates. For example:

These are just a few examples of questions to ask when assessing your risk. Knowing what types of risks you face will help determine what types of coverage you should be looking at.

2. Start contacting insurance professionals. Talking to a licensed insurance broker or agent can be a great way to ease you through the process of buying commercial insurance and help you collect quotes from multiple insurers. If you can find a broker or agent familiar with your industry, that can really help speed up the process of what local business insurance requirements you’ll have to meet.

3. Gather quotes. As when shopping for other types of insurance, you’ll want to get quotes from several different insurers. Make sure you’re getting quotes for the same types of policies and coverage levels for the most accurate comparison. 

Even after finding the right commercial insurance company for you, it is recommended that you re-evaluate your coverage on an annual basis.

According to the Insurance Information Institute, all businesses should be insured, even home-based businesses. While your homeowners insurance policy may cover some business-related equipment, the coverage limits may be too low and may not provide all the types of coverage you need.

Whether or not your business insurance policy covers remote workers will depend on your specific policy. If you’re not sure whether your policy covers remote workers, reach out to your insurance agent, broker, or company for clarification.

You may not be required to purchase workers’ compensation if you don’t have employees. However, that doesn’t necessarily mean you won’t need some form of small business insurance, whether that is a business owners policy, commercial auto, or a professional liability policy.

You can start the process of saving money on business insurance even before you have a policy by getting quotes from multiple companies. Insurance companies don’t have the same prices for the same policies and coverage limits, so you may be able to find lower prices for the same policies and amount of coverage.

Another way to save is to ask your agent, broker, or insurance company about discounts. For example, Hiscox offers a 5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} rate reduction to customers who have more than one policy with the company.