An LLC is a type of business whose liabilities, debts, and assets are separate from the owners. Ideal for startups owned by more than one individual, an LLC can be your local coffee shop, jewelry store, retail store, gasoline station, or any other venture.
When you run your business as an LLC, you can’t be sued or be held personally liable over the accidents, injuries, or property damage it will cause.
Nonetheless, it’s important to get limited liability insurance coverage to ensure that your LLC survives problematic situations. Read this guide to understand:
LLC insurance is a coverage especially made for individuals running limited liability companies. It offers different policies that cover exposures such as business property damage, liability over the loss of third parties, employee injuries, and more.
So what is an example of an LLC insurance policy? A general liability policy is very common. Others you can purchase from limited liability insurance for LLC, depending on the nature and profile of your limited liability company, are commercial property, workers compensation, business interruption, commercial auto, and D&O liability insurance.
Get all the best quotes from leading providers in a click of a button!
General liability insurance provides protection when a third party sues for personal injuries or property damage. Here are the situations where liability insurance for LLC is useful:
A client tripped over an unkept cord, fell on the floor, and sustained bruises
An employee injured a client while using a tool
Your LLC started a fire and other people’s property got severely damaged
People got injured and properties were damaged when your LLC caused an accident while conducting operations
So how do you use general liability insurance for LLC? You can use this insurance to:
Cover the medical treatment of third parties who file a personal injury claim against your business
Refund the value of a property owned by a third party, which got damaged or lost due to your LLC’s fault
Pay for attorney fees, administrative costs, and other related expenses if you need to defend yourself in court
General liability insurance only caters to claims filed by customers, visitors, and other individuals who have nothing to do with your business. It doesn’t provide protection when your LLC is sued for bodily injuries or property damage by employees, partners, and officers.
Additional coverages can be included in the terms of general liability insurance so that it provides more protection. These add-ons are:
Advertising injury coverage-Advertising injury coverage will pay for settlements, administrative costs, and other legal expenses when your LLC is sued for copyright infringement, slander, or libel
Liquor liability coverage-Liquor liability insurance provides protection when your LLC serves or sells liquor, and a customer files a claim and blames your LLC for bodily injuries or property damage caused by intoxication
Rented premises liability coverage-This type of LLC insurance coverage will refund the owner if a fire damages the commercial space your LLC is renting or leasing
The policy limit of LLC general liability insurance is $1 million-$2 million. However, you can find carriers that allow this type of business insurance for LLC to have custom limits, which are $300,000-$1 million.
Say what if your LLC is big? Can general liability insurance provide more? The answer is yes. There are insurance companies that allow this type of LLC business insurance to provide a $3 million-$5 million limit depending on your business profile.
Aside from general liability insurance, think about purchasing professional liability insurance if your LLC is any of the following businesses:
Software development firm
Web development firm
Lawn care contractor
Fire alarm installation contractor
HVAC installation contractor
House cleaning contractor
Commonly, LLCs use professional liability insurance to cover settlements, administrative costs, and attorney fees when a client sues for negligence after sustaining financial or economic losses due to a service that has substantial errors.
But note that negligence is only one of the many exposures covered by professional liability insurance. This limited liability insurance also provides protection when any of the following is committed while doing a task for a client:
Violation of good faith
Violation of fair dealing
There are two ways to avail professional liability insurance. You buy this type of limited liability company insurance as a claims-made policy or occurrence policy.
To use claims-made professional liability insurance, you report a covered incident to the insurance company within the time it happened.
On the other hand, occurrence professional liability insurance can be used on or after the time a covered peril happened. You can also use it even if it has expired, so long as the covered peril occurred while the policy was active.
Professional liability insurance has a $1 million-$2 million limit. But if your LLC provides medical services, this small business insurance for LLC can have $3 million-$2 million coverage.
Note that professional liability insurance has other names. This business insurance LLC is also called errors and omissions insurance, and malpractice insurance.
One final thing to mention is that professional liability insurance for LLC is sold as a stand-alone policy. However, some insurance companies underwrite this type of limited liability insurance for small business as a coverage included in the language of general liability insurance.
Product liability insurance is useful if your LLC manufactures, distributes, or sells items or food to make money.
You utilize this type of business insurance for LLC to cover judgments, attorney fees, and administrative costs if a claim is filed because the product has:
If your LLC is a restaurant or any other business selling food, then product liability insurance can be used to cover costs if someone sues for food poisoning or improper food preparation.
So how much coverage can I get from the product liability insurance for my LLC?-Good question. The policy provides $1 million coverage. You can choose to include it as an optional coverage that may be added to the terms of general liability insurance.
It’s problematic when your general liability or professional liability insurance reaches its limit-meaning that both policies have run out of funds and you can’t use them anymore or they have funds but can’t fully cover a claim.
Consider buying umbrella liability insurance so that you have backup funds when such a situation happens.
Umbrella liability insurance, when purchased, adds to the limits of your general liability or professional liability insurance. For example, if your general liability insurance only has $500,000 and the claim costs $1 million, then umbrella liability insurance will pay the excess.
So how much coverage can you get from umbrella liability insurance? Coverage is available in increments of $1 million. You can get a $1 million, $2 million, $3 million umbrella liability policy, and so on. The maximum amount of coverage is $10 million.
If you’re acting as the director or any other officer of your LLC, then consider purchasing directors and officers liability insurance.
Directors and officers liability insurance functions to cover the following when you committed or allegedly committed wrongful acts (e.g, misrepresentation or embezzlement) and is being sued by a third party:
Cost of extradition proceedings
Attorney fees, settlements, and other legal expenses
Public relations expenses
Cost of civil fines and penalties
The starting coverage of directors and officers liability insurance is $1 million-$2 million. But the smartest option is to get $5 million-$10 million coverage from the policy.
Liabilities aren’t the only things that can disrupt your LLC’s growth. Any damage or loss of its property is also a problem.
Carriers underwrite commercial property insurance for property owned by LLC. The primary function of this insurance is to insure your business’s building. Commercial property insurance will:
Refund the cost of any damaged structures of your LLC’s building such as roofing, siding, flooring, windows, etc.
Refund the value of your LLC’s entire building if it’s completely reduced into rubble
Commercial property insurance can cover equipment and items inside your building if you decide to include the following coverages in its terms:
Stocks and contents coverage-By adding stocks and contents coverage, commercial property insurance will recover losses if your LLC’s inventory, furniture, financial documents, and other valuable items become damaged or lost
Equipment and tools coverage-Equipment and tools coverage recoup your losses if machines, tools, and equipment used to make a product become lost or damaged
Remember that you can only use commercial property insurance for LLC company if any of the following causes the damage or loss:
Damage or loss caused by earthquakes, floods, and mudslides is excluded in the terms of commercial property insurance. You need to get specialized insurance or endorsements to have protection against these perils.
Commercial property insurance for LLC is available as a named perils policy or open perils policy.
A named perils commercial property insurance only covers perils you list on its terms. Anything excluded isn't covered. On the other hand, open perils commercial property insurance covers all kinds of perils except for those stated as not covered in its language.
The amount of money you can get from commercial property insurance depends on how much business property the carrier can cover. But usually, the starting limit is $10,000-$25,000. If your LLC is big, commercial property insurance can provide as much as $100,000-$300,000.
Some insurance companies underwrite a business owner’s policy for LLCs. A business owner’s policy pertains to an insurance product that combines general liability and commercial property insurance, so that the policyholder enjoys cheaper premiums and easier insurance management.
But note that most insurance companies sell a BOP that doesn’t only have general liability and commercial property insurance but other business insurance products as well.
And so, most BOPs that you’ll find online bundle general liability and commercial property insurance with workers comp, commercial auto, cyber liability, inland marine insurance, and more.
There will always be workplace accidents no matter which industry your LLC belongs to. And if such accidents result in employee injuries, your business must provide compensation. The best way to cover such responsibility without losing money is by buying LLC worker's compensation insurance.
Workers' compensation insurance is required as soon as your LLC has one or more employees. When at least one employee sustains an injury or a work-related disease, workers' compensation kicks in to cover the following costs:
Medical expenses-Your LLC can use workers compensation insurance to cover ambulance fees, emergency room fees, doctor fees, and other medical expenses
Hospitalization-Workers compensation insurance covers costs if an employee needs to be admitted for days, weeks, or months in the hospital in order to receive treatment for a work-related injury or disease
Medication-Insurance companies allow your LLC to use the funds of workers' compensation insurance to give money to an employee who needs to buy prescription medicines
Rehabilitation-Another function of workers' compensation insurance is to cover rehabilitation costs and see to it that your employee can fully adapt to a permanent or temporary impairment. And as such, it covers therapist and rehabilitation equipment expenses
Lost wages-Workers compensation insurance is underwritten to cover the lost wages of your LLC’s employee. Compensation for lost wages is a weekly allowance equal to two-thirds or 67% of your employee’s average weekly wage. This will be received until your employee is fit enough to return or the amount of maximum coverage in the policy’s terms is satisfied
Death benefits-If an employee dies due to a work-related injury or disease, workers compensation insurance allows your LLC to cover funeral expenses. The policy also functions to provide an allowance to dependents
Workers comp LLC is expensive. But the good thing is, it’s very easy to estimate how much you’ll pay. All you have to do is figure out the annual average payroll of each employee, divide them by $100, and then multiply the quotients by the cost of workers comp, which is $1 per covered payroll
Getting worker's compensation insurance is a smart move.
By having this insurance, you don’t only cover the above-mentioned costs but also prevent employees from suing for negligence when they sustain a work-related injury or disease. That is, if your LLC is in a state where employers enjoy an exclusive remedy.
Commercial auto insurance is handy if commercial vehicles are part of your LLC’s day-to-day business operations. There’s no doubt that you need this insurance when your LLC is a:
Food delivery business
Commercial auto insurance doesn’t function alone. Rather, it consists of different types of coverage. Particularly, these are:
Auto liability coverage-When your LLC’s commercial vehicle causes an accident and people got hurt or have their property damaged, auto liability coverage will cover the cost of medical treatment and reimbursements. It will also pay for legal expenses if a third party decides to sue
Physical damage coverage-Physical damage coverage takes care of costs if your LLC’s commercial vehicle sustains damage. You purchase this as a collision or comprehensive policy. Comprehensive physical damage coverage will cover repair or replacement expenses if fire, theft, vandalism, or weather damages the commercial vehicle. Collision physical damage coverage, on the other hand, will pay for costs if your commercial vehicle sustains damage after crashing into a vehicle or object
Uninsured/underinsured motorist coverage-Uninsured/underinsured motorist coverage will take care of costs if your commercial vehicle got involved in an accident caused by a driver who isn’t insured or doesn’t have enough insurance
Medical payments coverage-Medical payments coverage will cover the medical treatment of the driver and passengers if your LLC’s commercial vehicle gets involved in a vehicular accident. You get this if your LLC is in a fault state
Personal injury protection-Personal injury protection covers the medical treatment, after-hospital visits, rehabilitation, and lost wages of the driver and passengers if your LLC’s commercial vehicle causes an accident or gets involved in one
Rental reimbursement coverage-Rental reimbursement coverage will refund expenses if your LLC needs to rent a commercial vehicle
If your LLC is in the shipping industry, its commercial property insurance must be endorsed with MCS90.
The auto liability coverage of commercial property insurance doesn’t help if your LLC’s commercial vehicle caused an accident because the driver is DUI, it’s running away from police authorities, or got involved in any other criminal activities.
You should also know that when buying auto liability coverage, you must be sure that its limits conform with the minimum auto liability requirements enforced by the state where your LLC is located.
If your LLC is in the shipping industry, it doesn’t only need commercial auto insurance but also cargo insurance.
Cargo insurance is essential before you can ship the cargo of customers through interstate and intrastate lines.
When a cargo becomes lost or damaged due to a vehicular accident, jettison, theft, negligence, or malicious mischief, cargo insurance will refund the losses of the concerned client.
Get business interruption insurance if you’re worried about the resulting losses if your LLC needs to suspend operations because of renovation, relocation, or economic crisis.
Temporarily halting your LLC’s activity can be problematic because you still need to pay operational costs.
Business interruption insurance remedies this problem. While your LLC isn’t generating income, business interruption insurance will provide the money you can use to cover employee wages, loans, taxes, and mortgages.
The cost of liability insurance for LLC is $47.40 per month. If we translate this into annual premiums, then general liability insurance cost for LLC is $568.80.
There’s no fixed LLC insurance cost. That said, expect your actual rates to be more expensive or cheaper.
Factors that affect limited liability insurance cost are location, claims history, business experience, number of employees, number of owners, and more.
To get a better idea of how much business insurance cost LLC, here’s a table that shows the rates of the recommended carriers:
|Cost per Month||Cost per Year||Best for|
|NEXT||$18.49||$221.88||Best overall; Fastest|
|CoverWallet||$20||$240||LLC insurance quotes comparison online|
|Tivly||$22||$264||Comparing quotes over the phone|
|Thimble||$23||$276||LLCs providing drone services|
|State Farm||$25||$300||Retail stores or other LLCs that own/rent property|
|Geico||$35||$420||Ridesharing businesses or other businesses that utilize vehicles|
|Hiscox||$37||$444||LLC insurance policies with worldwide coverage|
|Mylo||$40||$480||Small personally-managed businesses|
|Progressive||$65||$780||Insuring commercial trucks and other vehicles|
|Allstate||$70||$840||Small businesses that need simple, custom-tailored insurance for an LLC|
|USA Insurance Co||$95||$1,140||LLCs in the transportation and shipping industry with poor commercial vehicle records|
One way to get cheap LLC insurance is to have high deductibles. A deductible is an amount you’ll pay to the carrier after you receive your insurance money. And when you pay high deductibles, insurance companies will cut the cost of monthly or annual premiums.
Another way is to ditch policies you don’t need. LLC insurance is packed with different business insurance products. But it doesn’t mean you need to have them all. You always have the liberty to remove policies that seem useless at the moment.
Finally, don’t forget to compare quotes. And if you’re asking where to get the best LLC insurance near me? We suggest you use our online quotes generator by clicking the “Get Quotes” button.
Get all the best quotes from leading providers in a click of a button!
Here are some reviews of the best LLC insurance companies. Let’s take a look at their pros, cons, and rate for a $1 million general liability insurance.
Issues a proof of insurance you can easily show to anyone
Fastest GL online
Great customer service and reputation
Outstanding value for money
Bundle two or more policies and get a 10% discount
NEXT doesn’t provide coverage to LLCs with poor claims history
NEXT covers very small LLCs, particularly those who only have 1-5 employees and have a business experience of 1-7 years.
This company offers commercial property, general liability, workers compensation, and commercial auto insurance for LLCs. When you bundle two or more policies, NEXT gives a 10% discount.
This company is a good option if you’re looking for fast coverage with custom dedicated limits and a certificate of insurance that can be sent easily in many ways.
Best for: Best overall; Fastest
Average cost: $18.49 per month
Our rating: 10/10
Has MyCoverWallet app for easy online policy management
Compare quotes online
Cancel a policy anytime
Has terrorism coverage
Doesn’t underwrite its own LLC insurance policies
CoverWallet is an insurance broker selling LLC business insurance policies of its partners such as Chubb, Liberty Mutual, and CNA. Examples of insurance products you can avail from CoverWallet are general liability, professional liability, commercial property, workers compensation, and commercial auto insurance.
This company has an LLC insurance quotes comparison platform you can use to find carriers with the cheapest rate. Upon getting insured, CoverWallet gives you access of its app where you can easily manage your LLC insurance policies.
Best for: LLC insurance quotes comparison online
Average cost: $20 per month
Our rating: 10/10
Assigns an agent that will help you craft a comprehensive insurance program
Customer service is very responsive
You need to call to get a quote
Tivly (formerly CommercialInsurance.NET) covers LLCs in different business industries. Note that if you can’t get covered, this company will take you to other carriers so that you don’t need to search again. Policies this insurance company LLC sells are general liability, commercial property, cyber liability, commercial auto, hazard insurance, and many more.
Call Tivly now and compare quotes over the phone.
Best for: Comparing quotes over the phone
Average cost: $22 per month
Our rating: 10/10
Sells daily, monthly, and hourly liability insurance
Has specialized drone insurance
$0 deductibles on its general liability insurance
You can’t call customer service
Thimble works best if you’re looking for monthly, daily, or hourly LLC general liability insurance. If you go for a monthly liability policy, Thimble allows you to pause your coverage anytime. Its daily and hourly liability insurance, on the other hand, provides instant protection and is very useful for quickly satisfying coverage requirements.
Best for: LLCs providing drone services
Average cost: $23 per month
Our rating: 9/10
Great ratings for limited liability insurance coverage
Local offices across the country
Excellent customer service
Doesn’t provide online quotes
If you need limited liability insurance for small businesses, then State Farm is a great insurance provider. In terms of overall customer satisfaction, they rank very highly. This is partly due to the fact that State Farm has agencies in small towns all over the U.S. This means that you won’t have to go through some of the headaches and long phone calls that other companies would require.
Note that State Farm doesn’t provide online quotes. To get quoted, you need to contact an agent. Don’t worry because you can easily find one using State Farm’s website.
Best for: Retail stores or other LLCs that own/rent property
Average cost: $25 per month
100% digital application process
Low-cost business insurance
Build your own LLC insurance policy
No in-person agents to speak with
For business owners looking for a more modern solution to purchasing insurance for an LLC company, Mylo is great. What makes Mylo so unique is that their service is 100% online and digital. Since the insurer doesn’t have to worry about the overhead of paying for expensive advertising and cross-country agencies, they’re able to provide prices that are a good deal cheaper than some of the larger, more well-known insurance companies.
Whether you’re looking for basic business liability insurance or you need to add on additional workers’ compensation coverage, commercial auto insurance, or even professional liability coverage, Mylo lets customers piece together their policies easily. This means that you don’t have to worry about wasting money paying for a bunch of coverage that you don’t really need.
Best for: Small personally-managed businesses
Average cost: $40 per month
Our rating: 9/10
File and track your claim online
Liability insurance can provide more than $2 million coverage
Majority of customer reviews in third-party sites are negative
Hiscox underwrites general liability, professional liability, and cyber liability insurance for LLCS. Note that the business insurance you’ll buy from this company provides worldwide coverage. Meaning that they’re useful even if your LLC’s operations are abroad.
Best for: LLC insurance policies with worldwide coverage
Average cost: $37 per month
Our rating: 8/10
Large nationwide brand
Getting an online quote is slow
Geico limited liability insurance is one of the insurer’s most popular products. Whether you own and manage a small personal business or you operate a larger business with numerous employees and greater risk, Geico is highly regarded as one of the best LLC insurance providers on the market. Since the company has a strong background in auto insurance, they’re a great choice if you own a ridesharing LLC or own a delivery business.
As far as the limited liability insurance cost goes, Geico can be a bit more on the expensive side. However, for the price, you’ll be provided with great customer service, an easy-to-use smartphone app, and quick access to agents across the country.
Best for: Ridesharing businesses or other businesses that utilize vehicles
Average cost: $35 per month
Our rating: 8/10
Friendly and fast service
Rewards for being a long-time customer
You only get a discount if your LLC already has commercial auto insurance from Progressive
Progressive has been underwriting insurance since 1937, making them one of the most reputable carriers in the nation. Although they aren’t quite as cost-friendly as State Farm, they do offer a number of benefits to their long-term customers.
One of the most popular bonuses is their commercial auto policy’s “disappearing deductible.” The longer that you’re a customer who keeps renewing his or her commercial auto insurance for an LLC, your deductible will slowly decrease every year.
Best for: Insuring commercial trucks and other vehicles
Average cost: $65 per month
Our rating: 8/10
Free LLC insurance quotes
Easy-to-contact Allstate agents
Relatively low-cost LLC insurance policy plans
Some policyholders report having to fight claims
If your LLC has recently started, then Allstate is one of the carriers that underwrite the best business insurance for LLC in the country. They’re well known for providing low-cost insurance for local businesses. They’re also able to custom-tailor a policy to fit your specific needs. This means that you won’t have to worry about paying for obsolete coverage. Like State Farm, Allstate has offices around the country, meaning that they’re fairly easy to contact if you need to make a claim.
Best for:Small businesses that need simple, custom-tailored insurance for an LLC
Average cost: $70 per month
Our rating: 7/10
Cheap commercial auto insurance for LLCs
Provides coverage even if your commercial vehicle has recorded violations
Doesn’t sell general liability and other business insurance policies
USA Insurance Co only sells commercial auto insurance for LLCs. The good thing about this company is that it provides coverage even if your LLC has recorded traffic violations. Also, the down payments for its business auto insurance is very cheap.
Best for: LLCs in the transportation and shipping industry with poor commercial vehicle records
Average cost: $95 per month
Our rating: 7/10
Lonnie Bell Insuranker
Policy Type: Business Insurance
Company name: Employers Insurance
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.
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
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.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
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!