NEXT Insurance is MoneyGeek's pick as the best sole proprietor business insurance provider, with competitive rates and extensive coverage options. The Hartford, Nationwide and Simply Business are also worth considering for sole proprietors.
Best Sole Proprietor Business Insurance
Updated: July 15, 2025
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Key Takeaways
The best sole proprietor business insurance provider is NEXT Insurance, which has a MoneyGeek score of 4.64 for comprehensive coverage and competitive rates.
The best business insurance for you depends on your industry type, state, business size and whether you have employees.
The Hartford offers the cheapest business insurance for sole proprietors at $62 monthly ($747 annually).
Best Business Insurance Companies for Sole Proprietors
| NEXT Insurance | 4.47 | 4.7 | 4.64 |
| The Hartford | 4.61 | 4.55 | 4.63 |
| Nationwide | 4.31 | 4.55 | 4.49 |
| Simply Business | 4.42 | 4.15 | 4.48 |
| Coverdash | 4.32 | 4.13 | 4.4 |
| biBERK | 4.22 | 4.55 | 4.38 |
| Progressive Commercial | 4.4 | 4.05 | 4.3 |
| Thimble | 4.52 | 4.04 | 4.3 |
| Chubb | 3.9 | 4.35 | 4.27 |
| Hiscox | 4.19 | 4.33 | 4.24 |
How did we determine these scores?
We based all scores on small businesses with two employees across professional liability, general liability, workers' comp and BOP policies.
LEARN MORE ABOUT SOLE PROPRIETOR BUSINESS INSURANCE
Nationwide
pros
Ranks 3rd overall in our MoneyGeek's study
Strong customer service reputation, ranking 3rd in customer service and 2nd in policy management
Has nearly 100 years in business
Provides both independent agent support and direct online/phone options
cons
Doesn't offer as many coverage choices as other providers
Average premium costs more than half the carriers researched
COMPANY HIGHLIGHTS
With an A ranking from AM Best, Nationwide has built a reputation for excellent financial stability with over nearly 100 years in business, ranking third overall in our study. Its customer service and policy management ranking make it worth considering if you prefer responsive support during claims or coverage questions.
Sole proprietor business insurance from Nationwide costs an average of $74 monthly, higher than many competitors we analyzed. It works through independent agents who can provide personalized guidance about your unique liability risks as a sole proprietor. The downside is that coverage options are more limited than those of other carriers, which may affect sole proprietors with specialized industry needs.
NEXT Insurance
pros
Ranks first in customer service
Provides a top-rated digital experience on its online platform
Wide range of coverage options for sole proprietors
Most likely to be recommended by current policyholders to others
cons
Claims process ranked lower than other providers studied
Offers higher premiums
Relatively newer in the insurance industry (less than 10 years)
COMPANY HIGHLIGHTS
NEXT Insurance is a good choice if you don't like dealing with insurance agents and want everything handled online. You can get a quote, buy coverage and get your certificate of insurance from your phone in minutes. The catch? You'll pay around $73 monthly, which is pricier than some competitors.
NEXT is also relatively new to the insurance industry and doesn't have the fastest claims process. It's best for tech-savvy sole proprietors who prioritize convenience and quality service.
The Hartford
pros
Ranked second overall among all carriers studied
Offers the cheapest rates nationwide
Delivers strong claims process performance
Provides solid customer service
Brings more than 200 years of proven industry experience
cons
Ranked last for digital experience
Not available in Alaska or Hawaii
Offers fewer coverage options than other providers
COMPANY HIGHLIGHTS
High insurance costs can cut into your business profits, but The Hartford prevents that with an average monthly premium of $62 for sole proprietor business insurance. That's the cheapest we found in our research. You're getting more than 200 years of stability with an A- AM Best ranking and top-notch claims handling, so you won't be left hanging when you need coverage most.
The catch? You'll deal with phone calls and agents instead of sleek apps, and it's not available in Alaska or Hawaii. If you're a budget-focused sole proprietor who'd rather save money than have the latest digital features, The Hartford's traditional approach gives you solid coverage without breaking the bank.
Cheapest Business Insurance Companies for Sole Proprietors
The Hartford offers the cheapest business insurance for sole proprietors at $62 monthly ($747 annually) among the companies we analyzed. Thimble, Simply Business and Progressive Commercial follow with monthly rates below $75.
| The Hartford | $62 |
| Thimble | $69 |
| Simply Business | $71 |
| Progressive Commercial | $73 |
| NEXT Insurance | $73 |
| Coverdash | $74 |
| Nationwide | $74 |
| biBERK | $77 |
| Hiscox | $79 |
| Chubb | $86 |
How did we determine these scores?
We based all scores on small businesses with two employees across professional liability, general liability, workers' comp and BOP policies.
Cheapest General Liability Companies for Sole Proprietors
For sole proprietor business insurance, The Hartford offers the cheapest general liability coverage at $61 monthly ($731 annually). Our study also shows that Simply Business, Nationwide and Progressive Commercial follow with monthly rates below $75.
| The Hartford | $61 |
| Simply Business | $69 |
| Nationwide | $71 |
| Progressive Commercial | $73 |
| NEXT Insurance | $74 |
| Coverdash | $76 |
| Thimble | $78 |
| biBERK | $83 |
| Hiscox | $83 |
| Chubb | $87 |
How did we determine these rates?
We calculated all rates based on small businesses with two employees across 79 industries and focused solely on general liability policies.
Cheapest Professional Liability Companies for Sole Proprietors
The Hartford is MoneyGeek's pick for the cheapest professional liability coverage for sole proprietors at $52 monthly ($627 annually). Our study found that NEXT Insurance, Progressive Commercial and Thimble also offer low-cost E&O insurance, with monthly rates below $56.
| The Hartford | $52 |
| NEXT Insurance | $53 |
| Progressive Commercial | $55 |
| Thimble | $56 |
| Simply Business | $56 |
| Hiscox | $56 |
| Coverdash | $57 |
| biBERK | $58 |
| Nationwide | $60 |
| Chubb | $65 |
How did we determine these rates?
We calculated all rates based on small businesses with two employees across 79 industries and focused solely on professional liability policies.
Cheapest BOP Companies for Sole Proprietors
The Hartford has the cheapest Business Owner's Policy for sole proprietors at $84 monthly ($1,009 annually), based on our research involving 10 national providers. Thimble, Simply Business and Nationwide follow with monthly rates below $107.
| The Hartford | $84 |
| Thimble | $88 |
| Simply Business | $104 |
| Nationwide | $106 |
| biBERK | $108 |
| Coverdash | $110 |
| Progressive Commercial | $110 |
| NEXT Insurance | $112 |
| Hiscox | $123 |
| Chubb | $130 |
How did we determine these rates?
We calculated all rates based on small businesses with two employees across 79 industries and focused solely on business owner’s policies.
How Much Does Business Insurance Cost for Sole Proprietors?
Business insurance for sole proprietors costs $57 to $108 monthly in our study, based on a profile with 2 employees, $150,000 annual payroll, $300,000 annual revenue and $1 million per occurrence coverage limits. However, actual costs vary significantly by coverage type, state and industry, which we'll break down below.
| Professional Liability (E&O) | $57 |
| General Liability | $76 |
| BOP | $108 |
How did we determine these scores?
We based all scores on small businesses with two employees across professional liability, general liability, workers' comp and BOP policies.
Average Cost By State and Coverage
Professional liability insurance costs the least across states, starting at just $49 monthly in Maine, North Carolina and North Dakota. BOP coverage in New York reaches $125 monthly, the highest we found, showing how your state and coverage choice affect your premium.
Data filtered by:Results filtered by:
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State:Alabama
Select
Coverage Type:General Liability
| Alabama | General Liability | $74.01 |
How did we determine these scores?
We based all scores on small businesses with two employees across professional liability, general liability, workers' comp and BOP policies.
Average Cost By Industry and Coverage
Insurance costs vary widely by industry, from drone operators paying just $12 monthly for general liability to pressure washing businesses facing $983 monthly for BOP coverage. Our study shows how the work you do determines what you'll pay for business insurance.
Data filtered by:Results filtered by:
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Industry:Accountants
Select
Coverage Type:General Liability
| Accountants | General Liability | $16.18 |
How did we determine these scores?
We based all scores on small businesses with two employees across professional liability, general liability, workers' comp and BOP policies.
What Factors Influence My Costs
Your business insurance premium depends on several factors, and figuring out what affects your rate can help you find the best sole proprietor business insurance.
Business location.
Where you operate makes a big difference in what you'll pay. Some states and cities are more expensive because of higher crime, lawsuits or natural disaster risks. Our research shows BOP coverage costs $122 monthly in New Jersey compared to $93 monthly in Maine for the same policy limits.
Business operations.
What you do for work heavily influences your rates. Our study puts a construction company's average monthly for general liability coverage at $129, while photographers pay $18 for the same coverage. Your specific activities, what you sell and any professional licenses you have all factor into pricing too.
Business size.
The bigger your business gets, the more you'll pay. More revenue and employees mean more things that can go wrong, so insurers charge accordingly. A solo freelancer will always pay less than someone running a team.
Business property value.
If you have expensive equipment, inventory or office space, your BOP premium goes up to match. Insurers need to cover the cost of replacing everything if disaster strikes.
Coverage choices.
Different types of business insurance cost different amounts, and higher limits cost more. For example, in our analysis, general liability in Florida costs $82 monthly, while professional liability costs $61 for the same business profile. Remember that raising or lowering your policy limits will change your actual premium.
Claims history.
Once you file a commercial insurance claim, you'll likely pay more when you renew your policy. Insurers see previous claims as a red flag that you'll likely file again.
Years in business.
New businesses pay more because they're unproven. Insurers start giving you better rates once you've been around for a few years without major issues.
Sole Proprietor Business Insurance Buying Guide
Now that you know your options, let's ensure you get the best business insurance for your needs. Whether it's basic liability protection or comprehensive coverage, you need to understand what's required in your state, decide if you want additional financial protection and find the best deal.
What Coverage is Required?
You're not legally required to carry business insurance if you're a sole proprietor without employees. But coverage becomes mandatory in these specific situations:
You hire employees.
Workers' compensation insurance becomes required in most states once you hire your first employee, though some states allow one to three employees before mandating it.
Your profession has licensing requirements.
Professionals such as lawyers, real estate agents, accountants and health care providers require insurance to maintain their licenses.
You use vehicles for business.
If you use vehicles for business purposes beyond personal errands, you'll need commercial auto insurance in addition to your personal policy.
What Coverage is Recommended?
While you might not be legally required to carry business insurance, finding the best sole proprietor business insurance for you allows you to financially protect your personal assets and livelihood. We recommend these coverages for common sole proprietor businesses:
Consultants | General liability, professional liability | One unhappy client who blames your advice for their losses can sue for substantial damages. Even if you did nothing wrong, defending yourself costs thousands. |
Freelancers (writers, designers, developers) | Professional liability, cyber liability | Missed deadlines or work errors can cost clients money, and they'll expect you to cover their losses. Plus, you're liable if client data gets breached on your watch. |
Contractors (handyman, plumbing, electrical) | General liability, commercial auto, workers' comp (if employees) | Working with tools and in people's homes means accidents happen. You're personally on the hook if someone gets hurt or you damage expensive property. |
Photographers | General liability, equipment coverage | Your expensive camera gear can get stolen or broken, putting you out of business. You're also liable if someone trips over your equipment during a shoot. |
Real Estate Agents | Professional liability | This is usually required for your license, but even if it wasn't, one mistake in a big transaction could wipe out your savings and then some. |
Accountants/Bookkeepers | Professional liability, cyber liability | Tax mistakes can be costly for clients, and they'll expect you to pay for any penalties or interest. Data breaches involving client financial info are expensive to fix. |
Personal Trainers | General liability, professional liability | People get injured working out, even when following your instructions perfectly. Without coverage, medical bills and lawsuits could cost you everything. |
Cleaning Services | General liability, commercial auto, workers' comp (if employees) | Clients might blame you if something goes missing or gets damaged. Plus, cleaning supplies and equipment can cause injuries or property damage. |
Food Businesses (catering, food trucks) | General liability, product liability, commercial auto | Food poisoning claims can be financially devastating, even if it wasn't really your fault. One bad incident could shut down your business permanently. |
Tutors/Teachers | General liability, professional liability | Working in clients' homes or with kids means higher liability risks. You need financial protection if a student gets injured or parents blame you for poor academic results. |
Sole proprietors have unlimited personal liability. Business debts and lawsuits can affect your house, car, savings and other personal assets. Insurance is your financial shield against these risks.
How to Get the Best Cheap Business Insurance for Sole Proprietors
Getting sole proprietor business insurance doesn't have to cost a fortune. Our step-by-step guide can help you find financial protection for your business without breaking your budget.
- 1
Figure out what your sole proprietorship needs.
Think about what could go wrong in your day-to-day operations and whether your state or clients require you to have insurance before you can work.
- 2
Start with the basics, then build up.
General liability covers the most common problems, like accidents or property damage. Add professional liability if you give advice, a BOP if you have equipment and office space or commercial auto if you drive for work.
- 3
Shop around and compare rates.
Get quotes from at least three companies or have an independent agent do it for you. Ask about higher deductibles, payment options and discounts to reduce costs.
- 4
Look beyond the cheapest price.
Check if the insurance company is financially stable, read customer reviews and check their claims process to see if they pay claims quickly when people need them.
- 5
Choose the best fit for your situation.
Go for the provider that offers the right coverage at a fair price and decent service. The absolute cheapest isn't always the best choice for sole proprietors.
- 6
Keep your rates low over time.
Avoid filing small claims if you can afford to pay out of pocket, keep your credit score healthy and review your coverage each year to drop anything you no longer need.
Business Insurance for Sole Proprietor: Bottom Line
NEXT Insurance tops our sole proprietor business insurance rankings with flexible coverage options and competitive pricing. The Hartford offers low-cost financial protection at $62 monthly, but offers fewer features. Your industry and budget should guide your decision between these two options.
Sole Proprietor Insurance: FAQ
MoneyGeek’s team answered frequently asked questions about sole proprietor business insurance:
Do I need business insurance as a sole proprietor?
You're not legally required to carry business insurance without employees, but it's highly recommended. Sole proprietors have unlimited personal liability, meaning business debts and lawsuits can affect your house, car and savings. Most clients also require proof of insurance before hiring you.
What business insurance should sole proprietors consider?
Most sole proprietors should consider general liability insurance at minimum, plus professional liability if you provide advice or services. If you have employees, workers' compensation becomes mandatory in most states. Consider a business owner's policy if you have equipment or office space.
How much does business insurance cost for a sole proprietor?
Business insurance costs vary by coverage type. Our study shows that professional liability averages $57 monthly, general liability at $76 monthly and business owner's policies at $108. Your actual cost depends on your industry, location and coverage limits.
What's the cheapest business insurance for sole proprietors?
The Hartford offers the cheapest business insurance for sole proprietors with an average monthly cost of $61 across all coverage types. Thimble ($69 monthly) and Nationwide ($71 monthly) also offer competitive rates for basic coverage.
What is general liability insurance for sole proprietors?
General liability insurance covers accidents, injuries and property damage caused by your business operations, plus legal defense costs if you're sued. For sole proprietors, this is essential financial protection since you're personally liable for business debts and lawsuits.
What happens if I don't have business insurance as a sole proprietor?
Without business insurance, you're personally liable for all business debts, lawsuits and claims. Creditors can pursue your house, car, savings and other personal assets. You also won't be able to work with most clients who require proof of insurance.
What's the difference between sole proprietor and LLC insurance?
Sole proprietors face unlimited personal liability and need insurance to protect personal assets, while LLC owners have built-in liability protection. However, both business types need similar insurance coverage: general liability, professional liability and property insurance.
Do sole proprietors need workers' compensation insurance?
Sole proprietors need workers' compensation insurance once they hire employees, though requirements vary by state. Most states require workers' comp after hiring your first employee. As a sole proprietor without employees, you aren't required to carry workers' compensation.
How do I choose the right business insurance for my sole proprietorship?
Start with general liability insurance, then add professional liability if you provide advice or services. Consider a business owner's policy if you have equipment or office space. Get quotes from multiple insurers and compare coverage limits, deductibles and claims service quality.
Can I deduct business insurance premiums as a sole proprietor?
Yes, business insurance premiums are generally tax-deductible as a legitimate business expense for sole proprietors. You can typically deduct premiums for general liability, professional liability and property insurance on Schedule C of your tax return.
How We Scored the Best Business Insurance Companies for Sole Proprietors
We studied thousands of quotes from 79 industries across four coverage types for a two-employee firm with $300,000 annual revenue and $150,000 payroll. All policies included $1 million per claim and $2 million aggregate annual limits.
Our Scoring Model
- Affordability (50% of score): We compared company rates across all coverage types to identify the most cost-effective options for sole proprietors who need comprehensive financial protection without overpaying
- Customer experience (30% of score): We analyzed J.D. Power satisfaction ratings, NAIC complaint data, online review sites and independent agency feedback to assess real-world service quality
- Coverage options (15% of score): We evaluated the breadth of coverage types, policy limits and add-on options available to accommodate growing businesses and diverse industry needs
- Financial strength (5% of score): We reviewed AM Best ratings, Moody's assessments and company financial reports to ensure insurers can reliably pay claims when needed
This approach helps sole proprietors compare insurers on affordable premiums, reliable claims service, adequate coverage and financial stability.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
sources
- AM Best. "AM Best Affirms Credit Ratings of Nationwide Mutual Insurance Company and Its Key Operating Subsidiaries." Accessed July 15, 2025.
- AM Best. "AM Best Revises Issuer Credit Rating Outlook to Positive for The Hartford Financial Services Group, Inc. and Its Subsidiaries." Accessed July 15, 2025.