Corporation Insurance: Liability Insurance for Corporations

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There are many things that distinguish corporations from startups and small LLCs or sole proprietorships. Corporations have tremendous revenues, employ many talents, and keep numerous resources-both financial and material. But there’s one thing that corporations and smaller businesses become similar - insurance.

Corporations still get insurance even if they have the money to cover eventualities. The tailored insurance policy most buy is called corporate insurance. This isn’t one insurance policy but is composed of different insurance products underwritten for businesses. Read this guide and dive deep into the particulars of corporation insurance.

Liability Insurance for Corporations

Liability coverage is a common inclusion in corporation insurance. This cushions a corporation from legal fees and settlements. There are many types of liability insurance for corporations such as:

Corporation General Liability Insurance

Your corporation can injure people or damage properties with its operations. General liability insurance takes care of this peril. Specifically, coverage extends to:

• Third-party personal injuries - General liability insurance will cover the medical expenses of the person who got injured due to your corporation’s business operations

• Third-party property damage - General liability insurance will reimburse the losses of the owners of the properties that got damaged due to your corporation’s business operations 

• Legal defense - If aggrieved third parties decide to take the matter in a court of law, general liability insurance will cover attorney fees, settlements, administrative costs, and other legal expenses on your corporation’s behalf 

General liability insurance for corporations comes with add-ons. Such add-ons provide an improved protection. Namely, these are:

• Advertising injury coverage - A third party will sue your corporation for copyright infringement, slander, libel, and other related offenses. In this situation, general liability insurance having advertising injury coverage will take care of administrative costs, attorney fees, compensatory payments, and other legal expenses

• Rented premises liability coverage - Rented premises liability coverage will reimburse the property owner if the commercial space you’re corporation is renting or leasing becomes damaged due to a fire

• Products and completed operations coverage - Products and completed operations coverage will cover attorney fees, administrative costs, compensatory payments, and other legal expenses if a completed/delivered product or service caused personal injuries or property damage and a past client decides to file a claim 

General liability insurance for corporations doesn’t cover claims filed by employees or directors, partners, and other executives. Coverage only applies to customers, vendors, visitors, and other related third parties. 

Professional Liability Insurance for Corporations 

Your corporation’s employees can commit errors and omissions while providing a service. As a result, a client will sustain financial or economic losses. Expect a lawsuit to be filed. And for protection, there’s professional liability insurance. Professional liability insurance will cover attorney fees, compensatory payments, administrative costs, and other expenses when a client sues your corporation for:

• Negligence

• Misrepresentation

• Violation of good faith

• Violation of fair dealing

• Other acts considered errors and omissions 

• Inaccurate advice 

Corporation Product Liability Insurance 

Your corporation can cause personal injuries or property damage due to a defective product or service. This is why insurance companies offer product liability insurance. Product liability insurance will cover attorney fees, compensatory payments, administrative costs, and other legal expenses if your corporation is sued for delivering a product having:

• Errors in design

• Errors in labeling

• Manufacturing defects

Commercial Umbrella Liability Insurance

Commercial umbrella liability insurance supplements the limits of your corporation’s liability insurance policies. When your general liability, product liability, or professional liability insurance has all its funds completely used, commercial umbrella liability insurance will provide additional coverage for excess expenses. 

Workers Compensation Insurance for Corporations 

Employees are one of the driving forces of your corporation. Such employees will experience a work-related injury or disease. This is why tailored coverage for corporations offers workers' compensation insurance. The function of workers’ compensation insurance is to cover the following:

• Medical treatment/procedure - Workers' compensation insurance will cover the surgeries, medical therapies, and other treatment or procedures an employee needs to fully recuperate from a work-related injury or disease 

• Hospitalization - If your corporation’s employee needs to stay in the hospital after undergoing a medical treatment/procedure, workers' compensation insurance provides the money to be used for paying the bills 

• Medication - Your corporation’s employee will need medicines to fully recover from a work-related injury or disease. This is also covered by workers' compensation insurance. The policy will provide the money your corporation’s employee can use to buy needed meds 

• Rehabilitation -  In case your corporation’s employee sustains impairment of bodily functions and needs rehab, workers compensation insurance will help cover therapist fees, rehabilitation equipment, and other related expenses 

• Lost income compensation - Workers' compensation insurance will help you cover lost wages if an employee requests a leave to fully recover from a work-related injury or disease. Compensation for lost income is a weekly allowance equal to two-thirds or 67% of the average weekly wage. For example, if your corporation’s employee receives $2,000 per week, lost income compensation will be $1,340

• Death benefits - When your corporation’s employee dies from a work-related injury or disease, workers' compensation insurance will pay for funeral expenses and provide an allowance to dependents

Note that insurance companies include optional policies in workers' compensation insurance. These are:

• Employer’s liability insurance - Employer’s liability insurance will cover attorney fees, administrative costs, and settlements if an employee sues your corporation for negligence after experiencing a work-related injury or disease

• Employment practices liability insurance - Employment practices liability insurance will cover expenses if your corporation’s employee sues for wrongful termination, sexual harassment, workplace discrimination, and other offenses related with the violation of employee rights 

Understand that workers' compensation insurance means a lot for your corporation. By having this coverage,  employees will not be able to sue your business after experiencing a work-related injury or disease. But still, this depends on which state your corporation is located. 

Not getting workers' compensation insurance is punishable by law. The punishment can be fines or imprisonment depending on which jurisdiction your corporation is conducting its operations. 

Note that many states allow corporations to self-insure if commercial carriers don’t provide workers comp coverage. Nonetheless, there are requirements to be followed if you decide to go for self-insurance. 

Corporation Commercial Property Insurance 

Your corporation has a building and other tangible assets. These are valuable. Tailored coverage for corporations has commercial property insurance. Its function is to cover:

• Building damage - When your corporation’s building incurs damage by fire, theft, extreme weather, vandalism, and other covered perils, commercial property insurance will provide the money you need to fix affected structures 

• Building destruction - Fire and extreme weather will destroy your corporation’s building. In this scenario, commercial property insurance will provide the money you can use for reconstruction

Commercial property insurance has additional coverages. These are:

• Stocks and contents coverage - When valuable items such as financial documents, furniture, office installments, etc. become damaged or lost due to fire, theft, vandalism, and other covered perils, stocks and contents coverage will recoup losses 

• Business equipment and tools coverage -  This will recoup losses if business equipment and tools such as manufacturing machines, employee equipment, and other similar items become lost or damaged due to fire, theft, vandalism, extreme weather, and other covered perils 

Understand that commercial property insurance doesn’t cover damage or destruction of business assets caused by earthquakes, floods, and mudslides. To get covered against this, get earthquake insurance, flood insurance, and mudslide insurance as endorsements or stand-alone policies. 

Business Interruption Insurance for Corporations

Business interruption insurance is also included in tailored coverage for corporations. This provides protection against financial losses when business operations are at a halt to make way for relocation, renovation, or let an economic crisis pass by.  In practice, while your corporation isn’t generating income, business interruption insurance will cover employee wages, mortgages, loans, and other operational costs. 

Corporation Insurance Cost

The average corporation insurance cost is $53 a month or $636 a year for a $1 million general liability insurance.  Know that the individual pricing of all the policies included affects the cost of corporate insurance.  Below is the individual  cost of corporation policies for 2022 :

I t's important to note that several factors affect the price of various insurance premiums, and these are:

Location

Costs of insurance vary based on the location of business operations. For instance, if one's business is located in an area that experiences natural calamities like flooding or storms regularly, they will pay more for coverage.

Number of Employees

The size of your business workforce is synonymous with the amount of money you pay for insurance. More employees mean more chances of injury or accidents. Therefore, large businesses pay more for insurance than small ones.

Industry

Some occupations are riskier than others. This implies that the premiums for those occupations will be high. For instance, a manufacturing or construction company will pay more for insurance than an e-commerce business.

Coverage Limits and Deductibles

The overall cost of your business insurance is also affected by the amount your policy is likely to pay out under specified circumstances. For instance, commercial auto insurance with comprehensive coverage is costlier than one with minimum liability coverage. Additionally, the cost of business insurance will be increased when a business opts for a low deductible.

Payroll and Sales

The worker's compensation insurance cost is directly related to the annual payroll. Also, insurers use a company's revenue to measure general liability insurance. Thus, the more customers a company has, the higher chances of injury or property damage claims.

As another point of reference, here’s a table showing the pricing of the most recommended insurance companies for corporation insurance:

Best Corporate Insurance Companies

The following are the best corporate insurance companies in the United States. Read to know their pros, cons, and monthly pricing for a $1 million general liability coverage.

CoverWallet Corporate Insurance

Why Get Insured by CoverWallet?

• Allows you to compare cheap corporate insurance quotes online for free

• Easy policy management

Why Take CoverWallet with a Grain of Salt?

• Not an insurance company but an insurance broker

CoverWallet, with the help of its partners, provides you with customizable corporate insurance quotes. Available policies corporations can avail are EPLI, general liability, business owner’s policy, commercial property, commercial auto, and more. CoverWallet doesn’t simply sell insurance to customers. This company is dedicated to helping them make the right investment when it comes to insurance. And so, it made a smart and free tool that provides the quotes of insurance companies in the United States. So that you and other customers can compare the offers and pricing of carriers.

Best for: Corporation insurance quotes comparison online

Average cost: $48 per month

Our rating: 10/10

Next Corporate Insurance

Why Get Insured By Next?

• Offers numerous policy discount options

• Covers you in an instant

Why Take Next with a Grain of Salt?

• Those used to traditional insurance processes might get taken aback by how Next do things

Next was established specifically for small businesses and sole proprietors. Hence, it provides policies essential to small businesses, like general liability and professional liability. It is unique among its competitors because it offers online quotes instantaneously, and one's coverage can begin on the same day. Its limitations are that it is not suitable for all types of business and it is still a young company established in 2016.

Best for:Instant coverage for corporations

Average cost: $51 per month

Our rating: 8/10

Hiscox Corporate Insurance

Why Get Insured by Hiscox?

• Transparent claims process

• Can insure multi-national corporations

Why Take Hiscox with a Grain of Salt?

• Hiscox has a lot of customer complaints

Hiscox is a multi-national insurance company offering property and casualty policies on its corporation insurance. Many like Hiscox because it offers very generous limits. Furthermore, the company boasts a very transparent claims process.

Best for:Worldwide coverage for corporations

Average cost: $55 per month

Our rating: 9/10

Nationwide Corporate Insurance

Why Get Insured By Nationwide?

• Has considerable experience in insuring corporations

Why Take Nationwide with a Grain of Salt?

• Not available in Alaska and Hawaii

• Some policies can’t be purchased online

Nationwide is the leading insurer in the United States with nearly 100 years in business. It offers traditional coverage options like general liability, professional liability, and commercial auto insurance and modern coverage options like cyber liability insurance for small and big businesses. Its online quotes are limited to only five types of coverage; it's unavailable in Alaska and Hawaii.

Best for: Experience in insuring corporations

Average cost: $60 per month

Our rating: 9/10

Berkshire Hathaway Corporate Insurance

Why Get Insured By Berkshire Hathaway?

• Available in 29 US states

• Provides a discount if a customer decides to pay annually for their premiums

Why Take Berkshire Hathaway with a Grain of Salt?

• Has a low rating from industry watchdogs

It offers two traditional Business Owner's Policies (BOP) and one more comprehensive option, making it the best BOP provider in the US. One of the advantages of using Berkshire Hathaway is that one gets a discount when they pay for their coverage annually. Unfortunately, it is unavailable in some states (it operates in 29 states).

Best for:Insurance for corporations to be paid annually

Average cost: $62 per month

Our rating: 8/10

The Hartford Corporate Insurance

Why Get Insured By The Hartford?

• Offers specialized coverages for very large corporations

Why Take the Hartford with a Grain of Salt?

• You can’t insure yourself with The Hartford

This insurer has the best policy plans for commercial property. It provides affordable and total coverage for every business, from sole proprietorship to multinational corporations. One of the advantages of contracting The Hartford is that its commercial property quotes are available online. Still, you need the help of an agent to complete the coverage application process. Its limitations are: if you have a large business, you will need extra specialized coverage. It is unavailable in the states (Hawaii, New Jersey, and Alaska) and lacks enough experience with big corporations. Another limitation is that some policies are unavailable online for customers' consideration.

Best for: Special coverages for corporations

Average cost: $68 per month

Our rating: 8/10

Progressive Corporate Insurance

Why Get Insured By Progressive?

• Offers comprehensive commercial auto insurance included in corporation insurance

• 24/7 customer service

Why Take Progressive with a Grain of Salt?

• Progressive custom policies are somehow lackluster

This is the United States' top commercial auto insurance provider, having written policies for over a million commercial vehicles as of 2019. One of the benefits of getting covered by Progressive is 24/7 customer care phone service and coverage in all the states of the US. It also provides direct commercial premiums to its customers. Its limitations are a few customization options for customers and limitations on the types of vehicles covered.

Best for: Corporation insurance with comprehensive commercial auto insurance

Average cost: $72 per month

Our rating:9/10

Chubb Corporate Insurance

Why Get Insured By Chubb?

• Multinational insurance company

• Offers comprehensive general liability insurance for corporations

Why Take Chubb with a Grain of Salt?

• There are reports saying that Chubb is too expensive for their liking

Chubb is a global corporate insurance company provider specializing in providing general liability policies to businesses of all types and sizes at a competitive price. Here are its benefits: it is suited for multinational corporations and small businesses. However, it does not provide online quotes for its commercial insurance policies and requires companies to purchase their coverage through an agent. Its global coverage also requires businesses to get an additional procedure which might hurt the pocket.

Best for: General liability insurance for corporations

Average cost: $75 per month

Our rating: 9/10