How much does business insurance cost?

How much does business insurance cost?

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  • How much does business insurance cost?</p>

<p>Karen Solomon for NEXTJuly 8, 2025 at 3:35 AM</p>

<p>E-commerce businesswoman looking at her tablet in her workshop. - PeopleImages.com - Yuri A // ShutterstockHow much does business insurance cost?</p>

<p>A small business insurance policy doesn't need to be expensive. The exact price you'll pay depends on a number of factors, including:</p>

<p>Your business operations (high-risk vs. low-risk operations).</p>

<p>What type of coverage you buy.</p>

<p>The insurance provider you choose.</p>

<p>How much you're willing to pay out of pocket after an accident or mistake.</p>

<p>NEXT shares what goes into what most small businesses pay for business insurance and how companies can save.</p>

<p>What affects the cost of business insurance for a small business?</p>

<p>Small business owners' insurance is often made up of different policies that provide protection for different risks.</p>

<p>You might decide to buy a combination of general liability coverage, commercial property insurance and workers' compensation insurance to protect your business and meet state or local requirements.</p>

<p>If you buy more types of coverage, you could have higher insurance costs, also known as higher premiums.</p>

<p>Your coverage limits (or policy limits) could also affect your cost, including:</p>

<p>The per claim limit — The maximum amount for each insurance claim.</p>

<p>The aggregate limit — Your maximum annual payout for a policy.</p>

<p>Finally, your deductible (the amount you pay before your insurance policy kicks in) can also be a factor in how much you pay.</p>

<p>What factors impact the cost of your business insurance premium?</p>

<p>Several factors impact the cost of business insurance premiums. These might include:</p>

<p>Type of business</p>

<p>Industry</p>

<p>Business structure (sole proprietor, LLCs, corporations)</p>

<p>Business location</p>

<p>Size</p>

<p>Revenue or business income</p>

<p>Payroll</p>

<p>Claims history</p>

<p>Coverage limits and deductibles chosen</p>

<p>Level of risk in business operations and activities</p>

<p>Number of employees</p>

<p>Value of assets being insured</p>

<p>Type of vehicle you drive</p>

<p>Driving record</p>

<p>A lot of factors, right? Insurance companies also consider external factors like economic conditions and market trends to determine the cost of annual premiums.</p>

<p>How can you save money on business insurance?</p>

<p>These four tips can help reduce your small business insurance costs.</p>

<p>1. Bundle more than one policy</p>

<p>Small business insurance comes in many forms.</p>

<p>Many businesses purchase a combination of these types of coverage for protection from different risks:</p>

<p>General liability coverage helps cover costs if you or an employee accidentally damages someone else's property, or medical expenses if someone other than an employee gets hurt as a result of your work (also known as bodily injury).</p>

<p>Commercial property insurance helps protect the equipment, inventory and physical property you use for your business. It can also include business income insurance.</p>

<p>BOP insurance (business owner's policy) combines general liability and commercial property coverage into one, often more cost-effective, policy.</p>

<p>Workers' comp insurance is required in most states for employers or if you have employees. It can help cover work-related illness or injury.</p>

<p>Professional liability coverage, also called errors and omissions (E&O) insurance,can help cover professional mistakes that cost a client money.</p>

<p>2. Lower your risk level</p>

<p>A safety and training plan can help prevent accidents — and accidents might increase your insurance premium. What's the best way to lower your risk?</p>

<p>Make sure you and your employees are properly trained.</p>

<p>Focus on work that you know how to do.</p>

<p>Don't do jobs you're not trained to do.</p>

<p>Make sure you have coverage for the work that you do.</p>

<p>Keep your business or job site secure.</p>

<p>Keep your business and work area clean so no one trips on cords, furniture, equipment or tools.</p>

<p>Take steps to mitigate property damage and injuries from rain, wind, snow and inclement weather.</p>

<p>3. Learn from your previous claims history</p>

<p>Analyze your previous claims history and figure out what you could have done to avoid those risks.</p>

<p>4. Pick the right limits and deductible</p>

<p>Lower limits will save you money, but you'll have a higher risk of financial loss if you don't have enough business insurance coverage.</p>

<p>If you choose a higher deductible, you could pay less for the policy.</p>

<p>This story was produced by NEXT and reviewed and distributed by Stacker.</p>

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