Finding cost-efficient general liability insurance is essential for business owners to save money on premiums while getting the best coverage for their business. On average, general liability insurance costs $342 per year for sole proprietors and $806 per year for LLCs in the software development industry — but note that this can change depending on where you’re located, what your industry is, who your insurer is and more.
Table of Contents
- Cheapest General Liability Insurance for Small Businesses
- Cheapest General Liability Insurance by State
- Cheapest General Liability Insurance by Industry
- Cheapest General Liability Insurance for Employers
- Cheapest General Liability Insurance Policy for Sole Proprietors
- How to Get Cheap General Liability Insurance
- Cheap General Liability Insurance FAQs
Cheapest General Liability Insurance for Small Businesses
Next offers the cheapest general liability insurance nationwide, offering affordable policies for sole proprietors and LLCs alike, along with a quick quote process. With Next, sole proprietors pay an average of $25 per month, while LLCs pay an average of $29 per month for general liability insurance.
How was this MoneyGeek score calculated?
Cheapest Overall: Next
Affordable for LLCs and sole proprietors
Takes very little time to get a quote
Has received a higher number of customer complaints
Has a lower financial stability rating compared to others on our list
Next is the best option for business owners looking for cheap general liability insurance and a fast quote time. On average, Next’s general liability insurance policies cost $306 per year for sole proprietors and $311 per year for LLCs.
Customers may be disappointed with Next’s customer service, however. Based on the national complaint index from the National Association of Insurance Commissioners (NAIC), Next has a high average rate of customer complaints. Additionally, AM Best has awarded it a financial strength rating of A-, which is lower than others on our list.
Affordable rates for sole proprietors
Strong financial stability rating from AM Best
Short time to get a quote
High average number of customer complaints
May not be the most affordable for LLCs
Established in 2016, Thimble aims to simplify and streamline insurance for small businesses. The company offers the cheapest general liability insurance for sole proprietors at an average rate of $287 per year. Thimble also had the quickest quote process of the companies on our list. Finally, a strong financial stability score from AM Best indicates confidence that Thimble is likely to be able to meet its financial obligations in case of a claim.
However, Thimble also has a high average number of customer complaints, suggesting their customer service may leave something to be desired. It may also not be the cheapest choice for LLCs, as their general liability policy for LLCs costs, on average, $808 per year.
Cheapest General Liability Insurance by State
Across states, Next and Thimble consistently rank as the cheapest general liability insurance providers. However, this can vary from state to state. Your business’ location has a significant impact on the cost of general liability insurance, as high-risk areas may face more expensive premiums. For instance, insurers may charge more if your business is located in a state prone to floods or earthquakes.
To find the cheapest general liability insurance by state, MoneyGeek collected quotes across the most populated ZIP codes in each state.
Cheapest General Liability Insurance by Industry
The industry your business is in plays a major role in determining the cost of general liability insurance. For instance, construction and cleaning industries carry a higher risk profile and usually incur higher costs since there is a greater likelihood of an accident involving a third party.
Review the table and filter it by your business structure to see how costs can change based on industries.
Quotes were gathered for the following business profiles:
- An LLC with five years in business, 20 employees, $5 million in annual revenue and $1,250,000 in annual payroll costs
- A sole proprietorship with five years in business, no employees, $500,000 in annual revenue and no payroll costs
Cheapest General Liability Insurance for Employers
With policies costing an average of $29 per month, Next is the cheapest general liability insurance option for LLCs. This average monthly cost is for LLCs with 20 employees. Keep in mind that your rate may differ depending on the number of employees you have.
Cheapest for Employers: Next
Affordable policies for LLCs (averaging $29 per month)
Short time to get a quote
Recorded a higher average number of customer complaints
Received a lower financial stability rating from AM Best than others
Next is a great option for employers who value affordability and want cheap general liability insurance. The company charges an average of $311 per year or $29 per month for LLCs with 20 employees. Note that these are averages, so actual rates may vary.
Despite offering low-priced general liability insurance, Next may not be the best choice for customers who place a premium on a good customer service reputation. When looking at data from NAIC’s complaint index, we found that Next received a higher average number of customer complaints than others on our list.
Cheapest General Liability Insurance Policy for Sole Proprietors
Sole proprietors looking for cheap general liability insurance can turn to biBERK. With an average cost of $275 per year or $23 per month and high customer satisfaction ratings, biBERK strikes a balance between affordable premiums and excellent customer service, making it a great choice of general liability insurance for sole proprietors.
Cheapest Annual Policy for Sole Proprietors: biBERK
A lower average number of complaints from customers
Strong financial stability based on AM Best rating
Affordable rates for sole proprietors ($275 per year)
May experience a slower quote process
Only offers general liability insurance in 27 states
With an average monthly rate of $23 per month or $275 per year, biBERK is the cheapest general liability insurance provider for sole proprietors. Backed by the Berkshire Hathway Group, it also has a strong financial strength rating from AM Best (A++).
It's worth noting that biBERK doesn't provide general liability insurance in all states. Furthermore, customers may experience some lag when requesting a quote. Out of the companies we examined, biBERK was consistently the slowest to produce a quote.
How to Get Cheap General Liability Insurance
As a business owner, general liability insurance is an essential expense that can help protect against costly lawsuits and damages. However, it can also be a significant expense that impacts your bottom line if you get more coverage than you need. Luckily, there are a few ways to lower the cost of general liability insurance without sacrificing coverage.
Raise your deductible
One way you can lower the cost of general liability insurance is by raising your deductible. This is the amount you have to pay before your insurance kicks in — the higher it is, the lower your monthly payments are.
Lower your coverage limits
How much liability insurance you get impacts your premiums. By lowering your limits, you can decrease your costs. This approach involves purchasing less coverage than what's typically recommended to save money on premiums. However, it's important to ensure that the business is still adequately protected in case of claims or lawsuits.
Shop around for coverage
Many insurers provide quotes online within a few minutes, making it easy to get an idea of the costs involved and discover the different types of business insurance you might want. By taking the time to shop around, you may be able to find a policy that offers the coverage you need at a lower cost.
Cheap General Liability Insurance FAQs
When it comes to running a business, finding cheap general liability insurance is essential to stay cost efficient. If you're a sole proprietor searching for the cheapest option for your business, we've compiled some frequently asked questions to help you gain a deeper understanding of your options.
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About Melissa Wylie