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The Best Small Business Insurance Companies for 2022

Best Insurance for Small Businesses

When you start your small business, you’re likely aware that you require business insurance, but understanding what insurance policies are truly necessary can be complicated and confusing. Small businesses may want to avoid paying excessive premiums, but it’s important to remember that if an incident should occur, the costs of having to handle a large claim without insurance could be enough to put many companies out of business. Your specific business insurance needs may vary depending on your specific industry, but there are a number of common policies that are relevant for most companies. 

The Best Small Business Insurance

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Chubb: Best Overall

Chubb is one of the largest global commercial insurers, with over $190 billion in assets and operations in over 50 countries. Consistently rated high in financial strength, Chubb has an A++ rating from AM Best and an AA rating from Standard & Poor’s, in addition to being rated #1 in J.D. Power’s small commercial insurance customer satisfaction study.

ProsCons
  • An extensive network of agents and brokers
  • Offers a wide variety of commercial insurance policies for numerous industries
  • Superior ratings from most major ratings firms, indicating financial stability
  • Offers discounts for home-based businesses
  • Good customer service
  • Some businesses may find Chubb's coverage options to be too comprehensive (and expensive) for their needs
  • Limited online quoting system
  • No live chat support on the website
  • Not a BBB-accredited company

AdvisorSmith Rating For Chubb

We chose Chubb as our best overall because of its diverse product portfolio, ability to service a wide range of businesses from startups to established companies, and high ratings on customer satisfaction and financial strength. Chubb is widely recognized as a strong insurer with excellent client support, and its wide range of insurance products means most small businesses will be able to find the right coverage for their needs. While their website capabilities have historically lagged some of their competitors’, Chubb has vastly improved its site in recent years, and we expect the improvements to continue.

» Learn more from Chubb.

» Read our Chubb Commercial Review.

The Hartford: Best General Liability Insurance

The Hartford is a top property and casualty insurer with a strong focus on small business coverage. The Hartford has been given an A+ rating by both AM Best and Standard & Poor’s, reflecting strong financial footing, and has been widely recognized for service excellence.

ProsCons
  • Flexible, customizable business owner's policy
  • Quick online quote process
  • Clear explanations that define what’s covered and not covered under a plan
  • You can get a quote online, but you have to talk to an agent in order to complete a purchase
  • There are reported Workers Comp and FMLA claims issues
  • The Hartford does not do business in Alaska, Hawaii and New Jersey

We chose The Hartford as our best general liability insurance company because of its strong financial ratings, robust product offering, and easy-to-use quoting tool. The Hartford is a well-known and established insurer, with a long history of providing coverage for small businesses. While there have been some mixed reviews from customers, overall, customer sentiment is extremely positive.

AdvisorSmith Rating For The Hartford 

» Learn more from The Hartford.

» Read The Hartford Commercial Review.

Progressive Commercial: Best Commercial Auto Insurance

Progressive is one of the top commercial auto insurers in the nation, with extensive experience insuring commercial vehicles. Progressive commercial insurance is a reliable and affordable option for business owners. Pricing is based on the type and amount of coverage you need, as well as the size and location of your business. You can get a quote online, submit a claim and get coverage quickly.

ProsCons
  • Reliable and affordable
  • Offers a variety of coverage options
  • Pricing is based on your specific needs
  • You can get a quote online
  • Coverage can start quickly
  • Not great customer satisfaction ratings
  • Not available in all states
  • Missing some types of coverage you may need to protect your business

We chose Progressive as our best commercial auto insurance company because of its established reputation in auto coverage, strong financial standing, and convenient and user-friendly online tools. While there have been some mixed customer reviews, by and large, Progressive has average satisfaction ratings.

AdvisorSmith Rating For Progressive

» Learn more from Progressive Commercial.

» Read our Progressive Commercial Review.

Hiscox: Best Cyber Insurance

Hiscox is an established leader in business insurance, with a strong focus on providing coverage to smaller businesses. Hiscox received A ratings from both AM Best and Standard and Poor’s, indicating solid financial strength, and the company boasts over 400,000 small business customers.

ProsCons
  • Offers a variety of insurance products
  • Offers discounts on its products
  • Has a mobile app
  • Website is easy to navigate
  • Limited policies to protect your business
  • May need to work with multiple providers to get full protection for your company
  • Does not have a local agent network
  • Only available in 49/50 states
  • Not a BBB accredited company
  • Mixed customer reviews

We chose Hiscox as our best cyber insurance company because of its strong focus on small businesses, robust financial standing, and extensive training and support in cyber risk for businesses. Cyber risk management can be a confusing and relatively new area for small businesses, and we found Hiscox’s suite of resources to be a great help for business owners without extensive cyber risk management experience.

AdvisorSmith Rating For Hiscox

» Learn more from Hiscox.

» Read our Hiscox Commercial Review.

Chubb: Best Professional Liability Insurance

Chubb was rated our overall best insurer, and the company tops out our professional liability category as well. With an A++ rating from AM Best and an AA rating from Standard & Poor’s, in addition to being rated #1 in J.D. Power’s small commercial insurance customer satisfaction study, there’s a lot to like about Chubb.

ProsCons
  • An extensive network of agents and brokers
  • Offers a wide variety of commercial insurance policies for numerous industries
  • Superior ratings from most major ratings firms, indicating financial stability
  • Offers discounts for home-based businesses
  • Good customer service
  • Some businesses may find Chubb's coverage options to be too comprehensive (and expensive) for their needs
  • Limited online quoting system
  • No live chat support on the website
  • Not a BBB-accredited company

We chose Chubb as our best professional liability insurance company because of its tailored professional liability and E&O solutions, high ratings on customer satisfaction and financial strength, and strong support for small businesses. Chubb’s professional liability insurance policies cover a variety of professions, including media, technology, financial institutions, architects, engineers, lawyers, and public entities. Chubb’s policies can be customized to fit individual businesses, and the company offers broad definitions of wrongful acts, damages, and insureds. 

AdvisorSmith Rating For Chubb

» Learn more from Chubb.

» Read our Chubb Commercial Review.

Chubb: Best Product Liability Insurance

Chubb, our pick for best overall insurer, also leads in our product liability insurer category. Chubb’s product liability insurance programs are customizable and can be tailored to fit many industries. The insurer offers a coordinated claims process, provides consulting services to reduce the likelihood of incidents, and can help manage long-term exposures such as asbestos.

ProsCons
  • An extensive network of agents and brokers
  • Offers a wide variety of commercial insurance policies for numerous industries
  • Superior ratings from most major ratings firms, indicating financial stability
  • Offers discounts for home-based businesses
  • Good customer service
  • Some businesses may find Chubb's coverage options to be too comprehensive (and expensive) for their needs
  • Limited online quoting system
  • No live chat support on the website
  • Not a BBB-accredited company

We chose Chubb as our best product liability insurance company because of their high ratings on customer satisfaction and financial strength and their robust risk management services. Chubb’s risk management programs are designed to promote product safety and minimize a company’s potential for products liability claims, helping business owners to benchmark risk management programs, identify opportunities for improvement, and minimize likelihood and impact of products liability losses.

AdvisorSmith Rating For Chubb

» Learn more from Chubb.

» Read our Chubb Commercial Review.

The Hartford: Best Business Owner’s Policy

The Hartford, our pick for best general liability insurer, is also our top insurer for business owner’s policies. BOPs typically cover general liability, commercial property, and business income insurance, which are critical coverages for small businesses. The Hartford has long been a top property and casualty insurer for small businesses, earning an A+ rating by both AM Best and Standard & Poor’s in addition to stellar consumer ratings.

ProsCons
  • Flexible, customizable business owner's policy
  • Quick online quote process
  • Clear explanations that define what’s covered and not covered under a plan
  • You can get a quote online, but you have to talk to an agent in order to complete a purchase
  • There are reported Workers Comp and FMLA claims issues
  • The Hartford does not do business in Alaska, Hawaii and New Jersey

We chose The Hartford as our best business owner’s policy provider because of their high customer satisfaction ratings, strong financial footing, and streamlined web experience. While a variety of insurers offer business owner’s policies, The Hartford offered the most robust product with a variety of endorsements and customizations for many different professions.

AdvisorSmith Rating For The Hartford 

» Learn more from The Hartford.

» Read The Hartford Commercial Review.

Brokers for Small Business Insurance

A good option for business owners is to work with a trusted insurance broker. Brokers can take into account your business’s needs and help you find and compare quotes from multiple insurance providers. Every insurer is different, and there are a lot of options out there. A broker can help you narrow down your selections and find a few options that may work best for your business. Below, we’ve highlighted a few of the top small business insurance brokers.

Embroker is backed by Munich Re, a financially strong insurer with an A+ rating from AM Best and an AA- rating from Standard & Poor’s. Embroker offers online quotes and claims, in addition to assistance that is available 24/7 via live chat, email, or phone. Embroker also provides a personal account manager who can help with insurance needs.

Embroker Pros and Cons

As with any insurance provider, it’s essential to weigh the pros and cons of Embroker:

ProsCons
  • Instant quotes and online buying
  • Industry-specific coverage
  • Expert advisors
  • Real-time claims tracking
  • Low premiums
  • 24/7 customer service

  • Not as long-established as other companies
  • No official ratings available
  • No mobile app

AdvisorSmith Rating for Embroker

» Learn more from Embroker.

» Read our Embroker Commercial Review.

CoverageSmith is a leading online broker specializing in insurance for small businesses. The company provides a modern, tech-enabled solution for businesses, allowing them to quickly get the insurance they need, completely online, from some of the most trusted insurance carriers in the world, including Chubb, The Hartford, AIG, and CNA.

» Learn more from CoverageSmith.

CoverWallet is an online broker backed by Aon, an insurer with an A rating from AM Best. The company provides online quotes, assessments to help you understand what types of insurance your business needs, and online claims processes. It may be possible to manage your pre-existing insurance policies through CoverWallet.

ProsCons
  • You can get free quotes from multiple insurance carriers
  • They offer many coverage options
  • You can create your own convenient bundle package
  • You can use their online tools to pay your premiums, file claims and download a certificate of insurance for free
 
  • While the platform is owned by AON it is not clear who is offering the policy you are requesting until the end of the application. CoverWallet is not a business insurer itself
  • You may have to call in to complete your application

AdvisorSmith Rating For CoverWallet 

» Learn more from CoverWallet.

» Read our CoverWallet Commercial Review.

Thimble is backed by Markel Insurance Company, an established insurer known for its focus on small business coverage and strong financial footing, with A ratings from both AM Best and Standard & Poor’s. Thimble is known for offering flexible policies for small business owners that can be purchased by the job, month, or year.

ProsCons
  • Offers flexible policies for small business owners
  • Scalable plan model
  • Fast and efficient quote process

  • May overpay for policies you don’t need

AdvisorSmith Rating For Thimble

» Learn more from Thimble.

» Read our Thimble Commercial Review.

Why do small businesses need insurance?

If a small business suffers a major disaster or is hit with a serious lawsuit, it may not have the financial resources necessary to recover. Although small businesses may believe that their risks are lower than larger corporations, they are subject to many of the same perils, and they are often hit harder if incidents arise. Insurance policies can take on some of the risks of doing business, providing funds that can help keep your business afloat through tough times. Business insurance is an essential way to protect your company’s assets and allow you to continue operating and building your business even if a costly incident occurs. 

What are the most important types of small business insurance?

The following types of business insurance are important for small business to consider: 

Commercial Property Insurance

Commercial property insurance protects the value of your business’s property, including owned or leased office space, furniture, computers, equipment, tools, and office supplies. This is a key coverage that most companies should carry, as damaged or destroyed property can be expensive and inconvenient to repair or replace, and the loss of property can severely impede your ability to operate your business.

Commercial property insurance can cover fire, explosions, windstorms, vandalism, theft, and other common hazards. Small companies should be aware that this type of insurance could be necessary even for home businesses or companies where employees primarily work remotely — homeowners and renters insurance policies often exclude coverage for business property. 

Example:

Business Interruption Insurance

Business interruption insurance, also known as business income insurance, can help your company continue operating in the event that property is damaged or destroyed, forcing you to temporarily close your business. If you must halt or reduce your business operations because of a covered cause of loss, your insurer will reimburse your business for its lost or reduced income. Coverage includes the business’s net profits plus normal operating expenses such as rent or mortgage payments, employee salaries, and taxes.

Business interruption insurance policies can be purchased with or without extra expense coverage, which would pay for additional expenses you incur in order to continue operating your business, either at your original location or a temporary one. This could include moving costs, rent for a temporary location, and rental equipment.

Business interruption coverage is typically available as an endorsement on commercial property insurance policies. It may be unnecessary for small businesses that are able to perform most work remotely and would likely be able to continue operating normally even if their physical property is damaged. However, small businesses that operate from a retail or commercial location, depend on costly, difficult-to-replace equipment, or have a high risk of property damage could benefit from this coverage.

Example:

General Liability Insurance

General liability insurance, also known as commercial general liability, covers your company if you unintentionally harm a third party. This is a key coverage because almost all companies have some level of risk for these claims. Risk exposure is particularly high for companies that perform dangerous work or have a high amount of foot traffic, such as retail businesses or companies that perform services for clients. However, even very small, non-dangerous businesses that rarely host outside visitors may still receive deliveries or require the services of repair technicians—all situations that could lead to an injury. 

General liability insurance provides financial assistance for a variety of different types of harm, including bodily injury, property damage, and personal and advertising injury. 

Example:

Workers’ Compensation Insurance

If your employees are injured, fall ill, or die in the course of their work, workers’ compensation insurance will provide them with medical and financial benefits. Workers’ comp can pay for an injured employee’s medical expenses, rehabilitation, and a portion of lost wages. In the case of a work-related death, workers’ comp can cover funeral costs and provide death benefits for the employee’s surviving family. Workers’ compensation is a no-fault policy, which means that insurers will pay benefits regardless of who is at fault for the injury. 

Workers’ compensation is regulated at the state level, with each individual state setting the regulations and requirements for what employees and injuries qualify, what benefits are provided and for how long, and what companies must secure workers’ compensation coverage. In most states, workers’ compensation insurance is legally required for companies that regularly employ others. It’s important to check your state guidelines to ensure that your business is in compliance. Failure to adhere to these local workers’ comp laws can result in civil fines and even criminal charges.

Example:

Professional Liability Insurance

Professional liability insurance, also known as errors and omissions insurance, is an important coverage for companies that provide professional services or advice. If your company is sued because of its professional work, professional liability insurance will provide financial assistance, covering legal defense fees and any resulting settlements or judgments.

The professional risks that different industries face can vary widely, so professional liability policies are usually designed for specific professions. Mistakes, omissions, or failures in professional work can often cause major financial losses for clients; if someone accuses you of unsatisfactory or negligent professional advice or services, you could find yourself embroiled in a costly, time-consuming lawsuit. Professional liability insurance can provide crucial support in these cases. 

Example:

Commercial Auto Insurance

Commercial auto insurance is necessary for any company that owns or leases vehicles under its name, as most states require a minimum level of liability coverage for all vehicles. The costs associated with automobile collisions can be extremely high, so it’s a good idea to make sure your company has sufficient coverage. Commercial auto insurance includes a liability component, which covers your company if it’s at fault in an accident that causes bodily injury or property damage, and a property component, which covers the value of the vehicle itself. 

Example:

Cyber Liability Insurance

Cyber liability insurance covers losses and damages that result from cyber events, including hacking, data breaches, cyberattacks, ransomware, cyberextortion, denial of service attacks, viruses, and more. This coverage is crucial for companies that rely on technology and electronic data, as most general liability policies specifically exclude coverage for cyber events. Even companies with excellent cybersecurity practices can fall victim to cyberattacks since criminals constantly develop new methods and find new loopholes for accessing systems. 

Although small companies may associate cybercrimes with incidents that occur with major corporations, small businesses are actually more likely to be victims of an attack. Smaller businesses often lack the resources and training to prevent cybersecurity breaches and may not be able to immediately identify and address any problems that arise. 

Example:

Employment Practices Liability Insurance

Employment practices liability insurance (EPLI) protects your company if current, past, or prospective employees sue with claims of wrongful treatment. When you operate a company, you control hiring, firing, promotions, and compensation — all aspects of employment that have a major effect on your employees’ lives. If your employees feel that they were treated unfairly, they could sue you with claims of wrongful treatment.

Lawsuits related to discrimination, harassment, retaliation, and many other employment issues are common. In the event of a lawsuit, your EPLI insurance would provide funds to cover your legal fees and any settlements or judgments against your company. Policies typically include coverage for your company, directors, officers, managers, and current and former employees.

Smaller companies are particularly vulnerable to EPLI claims because they may lack the resources to prevent situations from occurring. Small businesses are less likely to have dedicated HR and legal personnel to manage employee issues and handle complaints. They may not have clearly defined procedures for hiring, firing, documenting problems, or conducting performance reviews. Unclear procedures and regulations make it more likely that employees will perceive their treatment as wrongful and bring a suit, and it’s more difficult for employers to defend themselves in court if the reasons for their actions aren’t clearly documented. 

Example:

Business Owner’s Policy

A business owner’s policy (BOP) is a common option for small and midsize businesses. It combines a number of key insurance policies into one package, simplifying the process of buying insurance and enabling smaller businesses to save on costs. Premiums for BOPs are typically lower than the price of buying each coverage individually. BOPs typically include general liability, commercial property, business income, and extra expense coverage.

In addition, many insurers will allow you to tailor your BOP to your individual business needs, adding other types of coverage by endorsement. You may be able to add endorsements providing professional liability coverage, cyber liability coverage, bailee’s coverage, employment practices liability coverage, or other options, depending on your insurer and your company’s requirements. 

Companies must meet certain requirements to be eligible for a BOP, usually based on the type of business, size of its location, number of employees, and revenue. Exact requirements vary based on the insurer, but these criteria are common: 

How much does business insurance cost?

The costs of business insurance can vary widely depending on the nature of your business. When insurers evaluate your company to determine what pricing to offer, they look at your risk levels for the type of claims they would have to cover.

Common factors that affect pricing include: 

For more specific types of insurance, insurers look at the factors that raise risk for that coverage. For example, commercial auto insurance providers would look at the size of your fleet, types of vehicles, how vehicles are used, and other factors to determine your risk level and pricing. 

Average Annual Premiums for Small Businesses

Insurance TypeAverage Annual Cost
Business Interruption Insurance$500 - $1,500
Business Owner's Policy$350 - $2,500
Commercial Auto Insurance$750 - $2,500
Commercial Property Insurance$500 - $3,500
Cyber Liability Insurance$650 - $2,500
Employment Practices Liability Insurance$1,500 - $2,250
General Liability Insurance$365 - $1,700
Professional Liability Insurance$300 - $2,500
Workers' Compensation Insurance$375 - $1,400 per employee

How do I choose an insurance provider?

When considering an insurance provider for your small business, you should also make sure to pay attention to three major factors:

The financial strength of the company. Insurance claims are paid out of the money that an insurance company has available, so you’ll want to choose a company that has enough money to pay for potential claims. Major insurance carrier rating agencies, including AM Best, Fitch, Moody’s, and Standard & Poor’s provide letter grades evaluating the financial strength of insurance companies. Generally, it is safest to choose from insurance companies with ‘A’ ratings.

Pricing. Different companies have different models for pricing risks. You may find differences in premium rates for similar coverages from different insurance carriers. No insurer will have the cheapest rates all of the time, so it is worthwhile to shop around or work with an insurance broker to compare quotes.

Reputation for customer service. If you need to file a claim, make changes to your policy or billing address, or otherwise interact with the insurer, you will want an insurer with good customer service. Some insurance companies spend more than others on investments in technology and customer service. This can make a difference in your customer experience, especially when filing claims.

Final Word

There are many potential risks that could affect your small business. Although most business insurance is optional, purchasing comprehensive coverage is an important part of protecting your company’s assets. The specific insurance needs of your company will vary depending on the nature of your work, but the majority of businesses will need a selection of common, foundational policies. With a broad range of insurance coverage, you can feel confident that your business will be able to survive unexpected events and continue thriving.

Expert Commentary

AdvisorSmith spoke with the following experts to provide critical insight on commercial insurance for small business owners.

Steven Miller

  • Director, School of Risk Management and Insurance
  • University of South Florida, Muma College of Business
Steven's Answers

Q. How is the hardening commercial insurance market impacting small businesses? Are there any actions small businesses should take in a hardening market?

Q. How should businesses think about balancing risk and affordability when it comes to commercial insurance?

Q. What can businesses do to lower their commercial insurance premiums?

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