Average General Liability Insurance Cost (2026 Report)

Small businesses with one to four employees pay $123 per month ($1,474 annually) on average for general liability insurance with $1 million per occurrence/$2 million aggregate limits. This average reflects analysis across 408 industries and all 50 states, plus Washington, D.C.

This national benchmark doesn't guarantee your price. General liability premiums vary based on industry risk level, location and business size, even for identical coverage limits.

General liability pricing varies based on three core factors: business size, geographic location and industry classification. These variables explain most premium differences across small businesses because they capture key exposures insurers price: claim frequency, severity potential, operational setup and business activity level.

Premiums in our cost modeling use these three baseline drivers. The sections below explain how each influences general liability cost and how pricing shifts across businesses.

Solo operators pay $65 monthly for general liability insurance because they lack staff who could cause third-party injuries. Costs climb sharply as teams grow. A shift from one to four employees to five to nine employees costs over $200 more per month (168% higher) on average because more employees create more liability claim opportunities.

You can see how general liability insurance costs scale with team size below.

Industry is the second largest source of premium variation in general liability pricing due to its direct relation to operation structure, risk exposure and risk magnitude. Average monthly premiums range from $27 for Tech/IT businesses to $337 for Construction and Contracting for identical base coverage limits.

The 25 major industry categories fall into three cost tiers based on their difference from the national average:

• Low-cost industries (20%+ below national average): 14 of 25 industries (56%)
• Mid-cost industries (within ±20% of national average): nine of 25 industries (36%)
• High-cost industries (20%+ above national average): two of 25 industries (8%)

Ninety-two percent of industries fall close to or below the national average. Only 8% exceed average costs by over 20%, including Health Care and Contracting/Construction, which are 70% or more above the national benchmark.

The table below shows general liability costs by industry category. Pricing varies widely within each category based on subindustry risk level, employee count and state.

Use these resources to explore costs for your industry.

The state a business is located in is the third most influential driver for general liability insurance pricing because local medical costs, repair expenses, litigation activity and jury award patterns vary considerably. Average monthly premiums range from $87 in West Virginia to $190 in California for identical coverage limits.

States fall into three pricing tiers based on their difference from the national average:

• Lower-cost states (20%+ below national average): Nine states including Arkansas, Idaho, Iowa, Mississippi, Montana, North Dakota, South Carolina, South Dakota and West Virginia.
• Mid-cost states (within ±20% of national average): Thirty-two states including Alabama, Arizona, Colorado, Delaware, Florida, Georgia, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Michigan, Minnesota, Missouri, Nebraska, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Vermont, Virginia, Wisconsin and Wyoming.
• Higher-cost states (20%+ above national average): Ten states including Alaska, California, Connecticut, Washington, D.C., Hawaii, Maryland, Massachusetts, New Jersey, New York and Washington.

State pricing distribution is more balanced than many expect. South Carolina and Iowa offer rates more than 20% below the national average. But businesses operating in New York or California pay premiums over 40% above average.

The table below shows general liability premiums by state.

General liability premiums vary most by business size, industry type and state, but these baseline factors don't determine your final quote alone. Businesses can reduce premiums by adjusting the pricing levers insurers use at quoting and renewal without leaving coverage gaps.

Below we've summarized the most effective ways to lower general liability costs:

Beyond immediate actions, these long-term strategies lower general liability premiums as your business grows.

General liability insurance costs vary widely because insurers estimate your business's claim frequency and severity differently. Your premium moves most based on business size, industry classification and location. Use the $123 monthly national average as a benchmark, not a prediction.

Apply this report by considering context, not a single price:

1. Where do you fall compared to average? (industry + state + employee count)
2. What is driving your cost? (baseline risk vs. coverage design choices)
3. What would meaningfully change your price? (limits, deductible, bundling and accurate underwriting details)

Frame your premium this way to evaluate quotes and coverage options based on whether they reflect your true risk profile, not just whether they're above or below the national average.

Choose the right provider type and narrow your shortlist with these resources:

• What Are the Best General Liability Insurance Providers?
• What Are the Cheapest General Liability Insurance Providers?

After reviewing these resources, use your industry category, state and employee count from this report to set expectations, then request quotes using consistent details. This gives you a clean baseline to identify whether you're being priced fairly.