Basic Business Insurance: Liability, Cost & Quotes from $7

Accidents are inevitable. As a business, you ought to have comprehensive insurance in the event that there is an accident in the workplace. It would be best if you had basic business insurance, ensuring that your business and its proprietor are not left vulnerable. 

 

Seeing that as a small business owner, you have likely put your personal finances at risk, especially if it is a sole proprietorship; basic business insurance coverage protects said investment and other assets and pays for any unexpected legal liabilities. 

Also read:

• One Day Business Insurance: Liability, Cost & Quotes From $3
  

---

Basic Business Liability Insurance  

Basic liability insurance for small businesses protects the financial interests of the company and its owners in the event that they face formal lawsuits or third-party claims. Think of it as simple liability insurance covering any direct financial liabilities the business might incur, including legal defense expenses. 

 

There are three main types of business liability insurance. These include basic general liability insurance, professional liability insurance, and product liability insurance. 

Basic General Liability Insurance 

Insurance companies offer basic general liability insurance. The function of a basic general liability insurance is to cover the following:

• Third-party personal injuries-A basic general liability insurance will cover medical expenses if your business operations caused personal injuries and affected parties decide to file a claim 

• Third-party property damage-Your basic general liability insurance will reimburse the losses of third parties who experienced property damage because of your business operations 

• Legal expenses-General liability insurance ensures that you get adequate defense when someone files a personal injury claim or property damage claim. Particularly, you can use this insurance to cover attorney fees, administrative costs, settlements, and other related expenses

How much coverage can you get from basic general liability insurance? General liability insurance provides $1 million – $2 million you can use to cover personal injury claims and property damage claims. But note that some insurance companies underwrite basic general liability insurance providing $300,000 – $500,000 coverage. 

You will find insurance companies that allow you to upgrade the amount of coverage general liability insurance provides. That said, it’s possible for your business to be covered by general liability insurance having $3 million – $5 million coverage. 

Note that your basic general liability insurance can be added with the following optional policies:

• Liquor liability insurance-You can add liquor liability coverage to a basic general liability insurance if your business sells alcoholic drinks

• Rented premises liability coverage-This is available if your business is renting or leasing a commercial space to operate. The function of rented premises liability coverage is to reimburse the property owner if his or her commercial space becomes damaged by fire due to your fault

• Advertising injury coverage-Advertising injury coverage will cover legal expenses if you’re sued for slander, libel, copyright infringement, and other types of reputational or advertising harm

• Products and completed operations coverage-Products and completed operations coverage will take care of costs when a delivered product or service caused personal injuries or property damage to a customer

Basic Professional Liability Insurance 

Insurance companies will offer basic professional liability insurance if your business provides a particular service to make money. While giving a service, you or an employee might commit mistakes and this will result in the client’s financial or economic losses. Professional liability insurance protects you against this peril by covering attorney fees, administrative costs, compensatory payments, and other related expenses. Note that professional liability insurance doesn’t only cover mistakes, it will also kick in when your business committed or allegedly committed:

• Negligence

• Misrepresentation

• Violation of good faith

• Violation of fair dealing

• Breach of confidentiality

• Missed deadlines

• Other acts considered errors and omissions 

Basic Product Liability Insurance 

A basic product liability insurance will be very crucial if your business manufactures or sells food, clothing, and other consumer goods. This insurance will cover attorney fees, administrative costs, settlements, and other legal expenses if a customer holds your business liable for a product having:

• Manufacturing defects

• Labeling errors

• Design errors

If you’re a food business, then basic product liability insurance can help with food poisoning claims. But still, this depends on where you bought the coverage. Some insurance companies automatically include foodborne illness coverage in their product liability insurance. As for others, their basic product liability insurance doesn’t have foodborne illness coverage and must be endorsed or added with one to cover food poisoning claims. 

---

Basic Commercial Auto Insurance

Your business must purchase a basic commercial auto insurance if it’s using an automobile, pickup, motorcycle, truck, or any other vehicle to deliver goods, fetch raw materials, or take employees to project sites. A basic commercial auto insurance will offer the following:

• Auto liability coverage-When your business’s vehicle causes an accident, auto liability coverage will cater to the medical expenses of injured third parties. This will also pay third parties who had their property damaged by your commercial vehicle 

• Physical damage coverage-You can use physical damage coverage when your commercial vehicle incurs damage. This is available in two forms-collision and comprehensive. Comprehensive physical damage coverage will cover repair or replacement expenses if fire, vandalism, theft, hail, winds, and other covered perils damage your commercial vehicle. On the other hand, collision physical damage coverage will cover repair or replacement costs if your commercial vehicle got damaged after crashing into an object or another vehicle 

A basic commercial auto insurance is already enough provided that you’re running a small business venture. Nonetheless, insurance companies can add more protection to your commercial auto insurance, namely:

• Rental reimbursement coverage-Rental reimbursement coverage will recoup lease or rental expenses if you need to hire another commercial vehicle because the one that you own is being repaired 

• Motor truck cargo insurance-You can add motor truck cargo insurance to commercial auto insurance if your business delivers materials and goods for clients. This will cover expenses if the materials or goods you’re entrusted to deliver become damaged or lost during the trip

• Emergency roadside assistance coverage-This add-on to commercial auto insurance will reimburse your expenditures on towing, battery jump-start, tire replacement, tire delivery, and other roadside assistance services 

• Uninsured/underinsured motorist coverage- Uninsured/underinsured motorist coverage will take care of expenses if you get involved in an accident and the driver at fault has no insurance or doesn’t have adequate insurance

Basic Commercial Property Insurance Coverage  

Suppose your business rents the commercial real estate property from where you operate. In that case, you will require basic commercial property coverage, which will protect you against liability in the event that the property is damaged by fire, mold, floods, or other unexpected occurrences. 

 

Your business rents, owns, or leases the commercial property used for business operations. This is why it’s important for you to purchase a  basic commercial property insurance. Commercial property insurance covers:

• Building damage-When your business’s building is damaged by fire, theft, vandalism, and other covered perils, commercial property insurance will recoup losses up to the amount stated on its terms

• Building destruction-Commercial property insurance will cover reconstruction expenses if your business’s building is destroyed by fire or extreme weather. The amount you’ll receive will be equal to the actual cash value or replacement cost of the covered building 

 

Note that insurance companies allow you to add the following to your basic commercial property insurance:

• Stocks and contents coverage-This will recover losses if valuables, not considered as business equipment and tools, become damaged or lost while in the business premises due to fire, theft, vandalism, and other covered perils 

• Business equipment and tools coverage-Business equipment and tools coverage will recoup the capital you used to buy or make the equipment and tools essential for making products or delivering a service

 

Basic commercial property insurance might also include coverage for mold. However, this is often subject to very low sub-limits. Another thing, this doesn’t apply to all insurance companies. Some carriers underwrite a basic commercial property insurance that must be added with limited fungi coverage to take care of molds. 

Basic Workers Compensation Insurance 

Purchase basic workers’ compensation insurance as soon as your business has one or more employees. Failure to get this coverage will result in stiff fines and penalties subject to the existing labor laws and penal laws of the state you’re in. A basic workers’ compensation insurance takes care of the following:

• Medical treatment/procedure-Workers compensation insurance will cover surgeries, therapies, and other medical treatments/procedures if an employee sustains a work-related injury or disease 

• Hospitalization-You can use workers’ compensation insurance to cover your employee’s hospital bills

• Medication-By having workers’ compensation insurance, you can easily buy the medicines an employee needs to quickly recover from a work-related injury or disease

• Rehabilitation-Workers compensation insurance will pay for rehab if your employee experiences an impairment of bodily functions after sustaining a job-related injury or disease

• Lost income compensation-You can use workers’ compensation insurance to cover an employee’s lost wages

• Death benefits-If an employee dies from a work-related injury or disease, workers compensation insurance will take care of funeral expenses. It will provide an allowance to dependents too

---

Basic Business Insurance Cost 

Your business’s perceived risk levels will often determine the average cost of basic business insurance. For instance, if you are in the construction industry, you will require basic business insurance for all the heavy equipment and dangerous machinery you need for your business. This should attract significantly higher premiums than a business within the service industry. 

 

Expect to pay $30 per month or $360 per year for a basic general liability insurance providing $1 million in coverage. 

 

Overall, businesses that are considered to have lower risks will have cheaper basic business insurance policies. What’s more, it would be better to get a  BOP that combines general liability and commercial property insurance. A basic BOP policy is often more cost-efficient than buying commercial property and general liability insurance separately as it includes a bundle discount, and sometimes contains further coverage.

 

To have more idea about basic business insurance cost, take a look at this table showing the rates of the best basic business insurance companies:

Compare quotes to find the best basic business insurance. Click the “Get Quotes” button on this page and differentiate the offers and rates of the most recommended carriers in the USA.

---

Best Basic Business Insurance Companies 

Granted, it is not mandatory to have basic business insurance. Still, running your business without one is too risky as you risk business closure in the event of an unexpected occurrence. Seeing as it is a good business practice to have basic business insurance, here are the best basic business insurance companies available in the market today. Read the reviews below to know their pros, cons, and monthly rate for a $1 million basic general liability insurance. 

CoverWallet Basic Business Insurance

Pros

• Basic general liability insurance provides different amounts of coverage depending on the needs of the policyholder

• Basic general liability and commercial property insurance can be bundled in a BOP that additionally includes a worker’s compensation insurance policy

• Online quotes

• Cancel a policy anytime 

• Pay premiums online 

Cons

• You can’t cancel a policy online

CoverWallet is an insurance broker with an online quotes comparison platform you can use to find carriers providing basic business insurance to small businesses. Additionally, CoverWallet also sells the basic business insurance of its partners. Aside from comparing quotes, this company allows you to purchase and manage insurance online. You can also add landlords and clients as additional insureds. 

Best for: Basic business insurance quotes comparison online

Average cost: $22 per month 

Our rating: 10/10

Thimble Basic Business Insurance

Pros

• ACORD 25 certificate of insurance

• Short-term coverage

• Get a quote in 60 seconds

Cons

• Customer service doesn’t have a phone number 

Thimble’s basic business insurance is available by small businesses and independent professionals. You can opt to get covered for only hours, days, weeks, or months. Also, you can pause or cancel a policy anytime. Just like CoverWallet, Thimble provides online quotes and allows you to add additional insureds to your policy. 

Best for: Short-term basic business insurance

Average cost: $30 per month 

Our rating: 10/10

State Farm Basic Business Insurance

Pros 

• Nationwide network of agents 

• Several coverage options are available 

• Provisions off add-ons, including in-home business endorsements

• A general liability offering with $1 million increments 

Cons 

• Agents don’t work across state lines 

• Inconsistent customer service 

 

Started in 1922, State Farm is best known for auto and home insurance. With time, the insurer has expanded its portfolio to include 100 products, including basic business insurance. It has an A++ rating for financial stability from AM Best. 

 

State Farm sells its insurance to all 50 states, with each of the basic business policies being designed for each stage of your business’s growth. You have the option of adding on other types of insurance to meet the specific needs within whatever industry you are in. 

 

If you combine certain types of coverage as part of your business coverage, you stand to get a discount. You will pay $58 per month, $696 per year. 

 Best for: Best basic business insurance overall

Average cost: $21 per month 

Our rating: 10/10

NEXT Basic Business Insurance

Pros

• Live certificate of insurance

• Buy two or more basic business insurance and get a 10% discount

Cons

• NEXT caters to many businesses but some of its basic business insurance isn’t available by all 

NEXT gives a 10% discount if you buy two or more of its basic business insurance. Also, you can choose up to three ranges of policy limits. Upon getting insured, NEXT gives you a live certificate of insurance. You can also add additional insureds yourself via the NEXT mobile app. 

Best for: Businesses buying two or more types of basic business insurance

Average cost: $29 per month 

Our rating: 9/10

Hiscox Basic Business Insurance 

Pros 

• International standing 

• Basic business insurance is offered in 49 states and Washington, Dc

• Policies specifically designed for micro-business needs 

Cons 

• There are only nine offices in the United States 

• The parent company is not located in the United States 

• Basic business insurance is not offered in Alaska 

 

Hiscox was established in 1901 as an underwriter in Lloyd’s market. While its parent company is based in Bermuda, the U.S branch has its headquarters in Atlanta. The insurer offers basic business insurance to businesses in 14 countries and all 50 states in the United States. Hiscox’s offerings stand out as they have curated a product specifically designed and priced for independent contractors and freelancers. 

 

The standard general liability coverage limit extends to $2 million, all of which is available upon underwriting approval. The business insurance policy is sold by GEICO, which created a catalog of 180+ policies to cover different industries, including fitness instructors, acupuncturists and consultants. The general liability insurance starts at $22.50 per month, $270 per year. However, this could rise depending on what other add-ons you would like included. 

Best for: Independent Contractors 

Average cost: $29 per month 

Our rating: 9/10

The Hartford Basic Business Insurance 

Pros 

• Pay-as-you-go workers’ compensation that reduces the risk of premium discrepancies 

• Network of a million agent 

• State-specific insurance requirement guides 

• Second-largest provider of workers’ compensation insurance 

Cons 

• You cannot file business claims through the mobile application

• Application process is long and cumbersome 

 

The Hartford was established in 1810 as a fire insurance provider. The company has, with time, grown into a Fortune 500 company with a market share of over a million customers. This Connecticut-based company has an A+ rating from AM Best. 

 

Their basic business insurance includes general liability coverage, BoP, commercial auto coverage, data breach coverage, commercial umbrella and commercial liability coverage. Their pay-as-you-go workers’ compensation plan stands out as it is drastically cheaper and has a lesser chance of over-and underpayment of premiums. For minimal coverage, you will pay $71 per month and $852 annually.

Best for: Basic workers’ compensation policy

Average cost: $42 per month

Our rating: 9/10

Nationwide Basic Business Insurance 

Pros 

• The basic business insurance offered to 14 different industries

• A++ rating by AM Best 

• Investment services are also on offer

• Multiple coverage options are offered 

Cons 

• Basic business policies not available in Alaska and Hawaii 

• Lower than average customer service

 

Nationwide was established in 1926 as Farm Bureau Mutual Automobile Insurance company. It only became Nationwide in 1955, with coverage available from coast to coast, except in Hawaii and Alaska. 

 

If your business is high risk, Nationwide basic business insurance is the carrier for you. It has simple, straightforward insurance solutions. The basic business policy is offered to 14 industries, including retailers and other professional services. Per month, you will pay $17,  and $204 per year. 

Best for: Basic general liability insurance 

Average cost: $17 per month 

Our rating: 8/10

Progressive Commercial Basic Business Insurance

Pros 

• You get a discount on commercial auto when you combine it with general liability 

• Good financial standing 

• Auto insurance is offered in all 50 states 

Cons 

• Discounts are not available in all states 

• Poor customer service 

• Basic business insurance policies are offered through a third party    

 

Progressive was founded in 1937 and has grown to be the biggest commercial auto insurer in the country. Granted, commercial auto insurance remains their specialty. Still, they have expounded their offerings to include general liability, workers’ compensation, BOPs, professional liability and cyber insurance. A total of 63 industries and professionals are covered by Progressive Commercial basic business insurance. 

 

It is prudent to mention that you get a discount for commercial vehicles when you get general liability coverage orBOP. Both of these will attract an average of $35 per month for the most basic coverage and $420 annually. 

Best for: Basic commercial auto insurance 

Average cost: $53 per month 

Our rating: 8/10

Travelers Basic Business Insurance 

Pros 

• More than 25 industry specializations 

• A++  rating from AM Best 

• Has the second-highest premiums written in the United States 

Cons 

• Pricing and features are reliant on the industry operation

 

Travelers was established in 1864, but the company as known today was formed in 2004 through a merger between Travelers and St. Paul companies. It has since garnered an A++ rating from AM Best. 

 

Travelers basic business insurance is designed to meet the needs of businesses in 25 industries, including retail, manufacturing and transportation. The company operates in the U.S, Canada and the U.K, and as such, you should be covered as an international business. On average, you will pay $46 per month and $552 annually.

Best for: Basic commercial property insurance

Average cost: $46 per month

Our rating: 7/10

Liberty Mutual Basic Business Insurance 

Pros 

• Quick and easy application and claim processing 

• 24-hour claims  assistance

• Robust digital tools 

• Variety of discounts 

• Exemplary customer service 

Cons 

• Basic business policies are serviced by independent agents

• Auto claims satisfaction is below average 

 

Liberty Mutual basic business insurance stands out as it combines multiple coverages into a single policy that comprehensively protects against liability, property loss and loss of income. This is offered through independent agents across the country and is specifically designed for businesses within 12 industries, including construction, real estate, retail and wholesale. For a comprehensive business cover, you will pay an average of $42 monthly and $504 annually. 

Best for: Basic business owners policy 

Average cost: $42 per month 

Our rating: 7/10