Sometimes the unexpected occurs, and you never know when an unfortunate event will take place, leaving your business property totally ruined. Therefore, it is critical to have hazard business insurance. Let's discuss what it is, its purpose for getting an SBA loan, the average business hazard insurance cost per month and per year, and how to get your hands on the cheapest business hazard insurance policy, while not settling on coverage and insurer reliability!
Typically, business hazard insurance (also known as business property insurance or commercial hazard insurance) is a specialized coverage designed to protect your owned or rented business building and the equipment you use.
It's an insurance policy that can cushion you from financial losses when you need repairs and replacements after events, such as:
You’re running a restaurant and you didn't think that there’s a leaking gas pipe. A faulty wiring nearby threw sparks which ignited the gas leak and caused your business building to explode
An arsonist set your business building on fire and rendered it unusable
Your business building stands near the street.One night a vehicular collision happened and one of the cars was flung straight to your building by the impact
Hail accompanied by strong winds destroyed your business’s buildings windows, roofing, and doors
A strong lightning hit your building, causing some major damage on the electrical wiring and roofing
A group of burglars managed to get inside your building. Aside from stealing the contents inside, you discovered that the group managed to enter by breaking the glass panels of your commercial building
A faucet suddenly became defective during the night and kept running. By the morning, you discovered that your commercial building’s interior is soaked in water and some equipment got wet
The sprinkler detected smoke from somewhere. As a result, it started working and soaked important documents and business equipment in water
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Suppose you want to secure a business property through a mortgage; in that case, obtaining hazard insurance is almost imperative because most mortgage lenders require small businesses to have this coverage before they lend money. Your financier needs a guarantee that their investment is insured if a natural disaster, accident, or lawsuit puts the property at risk.
As with other lenders, you'll need to purchase hazard insurance for small business before taking out a Small Business Administration (SBA) loan for business . Afterward, you'll be eligible for an Economic Injury Disaster Loan (EIDL) or Paycheck Protection Program (PPP) loan.
Note that many experienced SBA asking for hazard insurance before granting a loan? So, to qualify for a loan through EIDL or PPP, SBA hazard insurance must be part of your general liability or commercial property coverage policy. With that said, always look for carriers that offer SBA loan hazard insurance products.
Most probably not. The function of business hazard insurance and commercial property insurance is the same. In fact, commercial property insurance is a type of business hazard insurance. The SBA doesn’t have any clarifications about this. For the most accurate answer, we recommend you call or email SBA to clarify this matter.
A homeowner’s hazard insurance won’t be enough for you to qualify for an SBA loan. The SBA expressly states that one of the requirements is hazard insurance for business. With that said, even if you don’t have a commercial property, you might still need to get business hazard insurance so that you can get an SBA loan for your home-based business. But note that before deciding to get business hazard insurance, it’s best to call SBA and ask if your business is allowed to get a loan.
When applying for SBA EIDL hazard insurance, understanding how much insurance you need and other SBA hazard insurance requirement streamlines the process. These are the EIDL hazard insurance requirement
The first requirement of hazard insurance for business SBA loan is a coverage limit must be at least 80% of the total amount you borrow. Still, you can obtain up to 100% coverage if you wish
The insurance policy must be under your business name
Proof of commercial property ownership
If you run your business as a DBA, it must be highlighted on the insurance policy
You must purchase the insurance coverage within 12 months of loan reception
If you received the loan in 2020, you must make the first payment within 24 months from the date you received it
For 2021 loans, you must make the first payment within 18 months from the date you received it
You can also leverage your business property insurance as hazard insurance on business contents. It means the policy will also cover any property or assets within your commercial building. The following are business contents that your small business hazard insurance might cover:
Office or business property
Inventory
Heavy equipment and tools
Furniture
Accounts receivable
Computers
Company documents
Outdoor structures, such as fences
If you have any queries about your hazard insurance for business content, speak to your insurance company/agent to ensure the policy is tailored to your needs.
As mentioned before, hazard insurance for business contents and property provides coverage when your business building or work equipment gets damaged due to natural disasters or human-induced events.
Obtaining hazard insurance for your business is not mandatory in many states. Still, insurance professionals recommend that you secure the policy to cover your commercial property. Without it, you'll have to cater to repair and replacement costs out of your pocket.
However, if you operate in a state that doesn't experience disasters like earthquakes, hail, or flooding, your commercial property insurance won't include them. In such a case, you need to obtain separate coverage for that. For instance, if you run a business located on Florida's beachfront, you won't be covered for hurricanes or floods. Neither will you get business coverage for an earthquake for a commercial property in California. These are natural events that can make businesses lose millions in a day.
Depending on your business's area, you'll need specific types of hazard insurance for commercial property. Below are three examples:
Earthquake insurance – As the name suggests, this policy protects you when your property collapses or gets ruined due to an earthquake up to your coverage limit
Flood insurance – This coverage cushions you from financial losses due to flooding, whether snow/ice thawing, hurricanes, torrential rains, or flash flooding
Terrorism insurance – Acts of terror are a business hazard, and terrorism insurance provides the coverage you need during such disasters
These estimates are for insurance coverage with a policy limit of $60,000 and a median deductible of $1,000.
By comparing business hazard insurance quotes online from various providers you will find cheap hazard insurance for business - from top carriers - which may not be found elsewhere. To do so, simply click the 'Get Quotes' button at this page, complete the questionnaire and you will be able to choose your quotes, coverage options and carrier online with ease.
Small business hazard insurance cost varies from company to company. That's because the price depends on several variables:
Your commercial property's value
Replacement value vs. actual value
Lender requirements and terms
To get more idea about the cost, take a look at this table that shows the best business hazard insurance companies and their pricing:
| | Business Hazard Insurance Cost per Month | Business Hazard Insurance Cost per Year | Best for |
|---|---|---|---|
| CoverWallet | $41.28 | $495.36 | Business hazard insurance quotes comparison online, Start-ups, self-employed, and SMBs |
| NEXT | $47 | $564 | SMBs looking for an insurer that understands their needs |
| State Farm | $58 | $696 | Overall business hazard coverage needs |
| Progressive | $63.73 | $764.76 | Small businesses looking for cost-saving opportunities |
| The Hartford | $71 | $852 | Businesses looking for deeper involvement in their insurance purchases |
| Berkshire Hathaway | $82 | $984 | Business hazard insurance and other types of business coverage |
Although shopping around and comparing insurance plans and estimates is an excellent means of getting affordable insurance rates, you can use other practical tips to ensure you retain more money when shopping for insurance policies. Some of the most effective money-saving practices include:
Choosing a higher deductible – A deductible is an amount you pay from your pocket before your insurance provider intervenes; the higher the deductible, the lower the insurance rate
Bundle up multiple policies – Most insurance companies offer discounts by purchasing a packaged policy that includes various individual coverages. An example is the Business Owners Policy (BOP). Such a policy provides standard coverage and lowers liability limits, which is an ideal option for many small and mid-sized businesses
Work closely with an insurance agent – Agents are knowledgeable and experienced professionals in the insurance world. They can advise you on the best coverage for the disaster you are most prone to, as they are experts in disaster planning. B e open to them and disclose any relevant information, such as business expansions, changes, purchases, recruitment, and the nature of your business. Getting a policy that offers the right protection can save you money in the long term and prevent your business from going on a financial plunge
Ask if there are any business experience discounts - Carriers offering business hazard insurance offer discounts to businesses who have been operating for more than three years. Discount rates are 3% - 5%
Pay the business hazard insurance for the whole year - Decide to pay for the business hazard insurance for the whole year. If you do this, carriers will give a 5% - 7% discount
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Many insurance companies operate throughout the US, and not all are the best choice when you want to purchase small business hazard insurance. What you need is an insurance provider that knows your needs and tailors the policy to cover unique risks. Below, we provide the top six insurance companies for business hazard insurance.
Offers insurance recommendations based on your industry
Multiple quotes available easily
Wide range of policies
Doesn't underwrite its business hazard insurance
If you run a start-up or are self-employed, CoverWallet is the best insurance marketplace when you need business hazard insurance. Your business property insurance from CoverWallet will cover your physical structures, business equipment, and inventory. You'll get hassle-free coverage for the specified hazard up to your policy's limit.
Since CoverWallet is an insurance marketplace with multiple providers, policy shoppers can leverage the "MyCoverWallet " dashboard to file their claims based on their chosen provider. Still, buyers can access CoverWallet representatives ready to make the process simpler.
Best for : Start-ups, self-employed, and SMBs
Average cost : $41.28 per month
Our rating : 10/10
100% online
A-Excellent by AM Best
Instant quotes (less than five minutes)
Unsuitable for traditional paper-focused clients
Lacks specialized insurance, such as personal coverage
NEXT was established by three co-founders who've been small business owners themselves. Therefore, they understand your needs as far as hazard insurance is concerned. The insurer offers simple, affordable, and personalized coverage for small businesses across various sectors. NEXT is a technology-first insurance company that allows you to get business hazard insurance quotes online..
Trusted by 300,000+ small businesses, NEXT boasts an "A- Excellent " rating from AM Best. You can be sure you're dealing with a reputable insurance carrier. From purchasing new coverage, renewals, or claims, you'll get the help or guidance you need. If you need to file a claim, a decision is often made within 48 hours.
Best for : SMBs looking for an insurer that understands their needs
Average cost : $47 per month
Our rating : 8/10
Insurance policies available nationwide
Wide range of policies, including other endorsements and add-ons
Level of customer service varies from agent to agent
Many insurance brokers can't sell insurance across state borders
Established in 1922, State Farm boasts a portfolio of over 100 products, including business hazard insurance, financial services, commercial insurance, etc. Clients can rest assured that their insurance policies are written by a company with AM Best's A++ rating.
This company provides general liability and commercial property insurance with hazard coverage for each stage of your business growth. It also tailors the policy based on your business sector, from contractor companies and restaurants to travel and retail businesses . Besides, you can enjoy huge discounts from independently owned State Farm agencies.
Best for : Overall business hazard coverage needs
Average cost : $58 per month
Our rating : 10/10
Hassle-free quotes process
Available throughout the country
High financial strength rating from AM Best
Discounts may not be available in all states
Progressive insurance was established in 1937. It is one of the biggest auto insurer in the US, although it also provides business property insurance. Other insurance products include business owners' policy (BOP), workers' compensation, and many more.
The upside to choosing Progressive is that you may get a discount on your business hazard policy if you already have general liability or a BOP, regardless of where you purchased it. Besides, clients can save up to 15% for settling their annual premiums upfront.
Best for: Small businesses looking for cost-saving opportunities
Average cost : $63.73 per month
Our rating: 8/10
Tailored insurance policies to suit industry-specific coverage needs
Offers a wide range of insurance policies
BOP policies include business interruption policies
Businesses looking for $2 million+ policy limits will have to look elsewhere
Coverage unavailable in Alaska, New Jersey, and Hawaii
The Hartford is an insurance company with over 200 years of experience. The company boasts seasoned specialists ready to help clients assess their risks and hazards. Its hazard insurance offers broad coverage to get you back on your feet after a covered loss.
An advantage of purchasing insurance from The Hartford is that the agents work with clients to understand their needs and write them the coverage that best suits their businesses. Filing claims is straightforward through the help of Hartford specialists, who can take you through the entire filing process. The provider also has Complex Liability Solutions to cover you if your business is vulnerable to higher hazards.
Best for : Businesses looking for deeper involvement in their insurance purchases
Average cost : $71 per month
Our rating : 8/10
Provides several types of coverage
A+ AM Best rating
A+ BBB rating
24/7 claims reporting
Several complaints cited on BBB
Mixed customer feedback
Not all products available in every state
Berkshire Hathaway was founded in 1983. The insurance provider offers 13+ insurance products, including hazard coverage (as part of business property insurance). Although the company has an estimated 550 representatives, it works with independent insurance agents and brokers, so you can be confident of getting personalized coverage for your business.
Berkshire also provides cost-saving opportunities on insurance, although you'll have to bundle up or purchase multiple insurance policies. Clients can report claims 24/7, and their customer service can contact you through various channels to offer feedback on claims. Other than that, Berkshire boasts an A+ rating from AM Best and Better Business Bureau (BBB).
Best for : Business hazard insurance and other types of business coverage
Average cost : $82 per month
Our rating : 6/10
Business hazard insurance only covers perils named on its terms. For example, if the business hazard insurance of a carrier doesn’t mention fire, vandalism, or theft, then your business won’t get protection against these. This is why it’s very important for you to ask about the particulars of the business hazard insurance you’re about to purchase.
Consider getting business hazard insurance even if you’re not getting a loan. A business hazard insurance gives peace of mind and helps run your business with more confidence. Also, you never know. You might not need a loan right now but will do in the future. And so, it’s better for you to have business hazard insurance even if it seems useless, than not have it when it’s badly needed.
Construction businesses will find business hazard insurance useful. Construction businesses have a lot of expensive materials and equipment. A business hazard insurance can greatly reimburse losses if covered perils disrupt the operations of construction businesses.
Just like construction businesses, gasoline stations will benefit greatly from business hazard insurance. Say, if a fire happens, a gasoline station will surely be engulfed in flames. With business hazard insurance, the property owner can recover most of the losses and build the gasoline station once again.
Manufacturing firms, such as those making candles, never underestimate how useful business hazard insurance can be. It’s because they have a lot of equipment that gets damaged occasionally. Basically, the coverage can prevent losses and ensure that manufacturing firms don’t spend a lot of money to keep business operations running smoothly.
Business hazard insurance is a very powerful protection for jewelry stores. Jewelry stores suffer from the damage caused by the occasional thief or burglar. Business hazard insurance can pay for their commercial space’s repair.
Use our free online quotes generator to look for the cheapest and most useful business hazard coverage. To compare business hazard insurance quotes, click the "Get Quotes " button at the top of the page to get the cheapest rates from the best providers.
1 / 5
Use anyone except Employers. Period. They are non-transparent and shameful. After I complained long enough to warrant a call from a supervisor, the supervisor called back from a PRIVATE NUMBER (no caller ID), left a message that they are not reversing their decision (without any communication with me), and failed to leave a phone number for me to call back. She was hiding! They also fact find via email and phone calls, which is terrific for speed and communication. However, after setting a precedence of email or phone calls, they send time sensitive information via email, without any heads up... they are hoping you miss it and forfeit via expiration. Evil policies. Go elsewhere.
1 / 5
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
1 / 5
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
5 / 5
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
5 / 5
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!
Not all those who wander are lost.
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