How to Save Money on Insurance for Your Small Business

Small businesses can be an expensive venture. That’s why so many people choose to start their own business instead of working for someone else. But starting your own business doesn’t come with a handbook or list of cheap things you can do. It costs money to start your business, and it costs money to keep it running. Some of these expenses may seem small at first, but they add up quickly over time. Insurance is one of the most common and expensive costs for any small business owners. Fortunately, there are lots of ways you can save money on insurance for your small business. We’ll cover each of them below and some ways to get started if you aren’t sure where to begin.

Know your insurance options

First, you need to evaluate what type of insurance your business needs. In addition to the liability coverage you may already have, your policy should include property insurance, business interruption insurance, and worker’s compensation insurance. Property insurance protects your business assets, such as equipment, inventory, and furniture. Business interruption insurance covers a sudden and unexpected event, such as the loss of a customer’s business, an employee’s injury, or a natural disaster. Worker’s compensation insurance covers employees who suffer an injury on the job. All of these policies vary in price, so you should shop around to find the best prices.

Understand Your Needs

It’s important to understand exactly what type of coverage you need for your insurance policy. And, of course, you need to be able to explain what your business does and what is at risk. Once you understand your insurance needs better, you’re in a better position to negotiate a better price. Be sure to ask your insurance agent to explain your coverage options in detail, including the differences between general liability, business liability, and professional liability coverage. General liability covers any lawsuits filed against your business and money damages, such as medical bills, and punitive damages. Business liability protects your business assets and assets of your employees and directors, such as their wages and any money they have in their accounts. Professional liability protects your business from claims from doctors, lawyers, and other professionals who work for your business.

Ask For a Discount When You Can

When you can, ask your insurance agent for a discount. Sometimes, you can negotiate a lower price for your insurance by asking for a discount. You’ll want to do your homework and find the best prices available, but you may be able to get a better deal if you’re willing to shop around. While insurance agents don’t like to hear this, you may be able to save even more money if you shop around for a different insurance company.

Negotiate With Agents and Brokers

Another way to save money on insurance is to negotiate with your insurance agent and broker. Most agents and brokers have a set rate they charge that they aren’t willing to drop down or change. They’re just doing their job, but you may be able to negotiate a lower rate because you know what your insurance needs are and you’re willing to walk away if the price isn’t right. If you can negotiate a 10% or even 5% lower rate, you may be able to save a significant amount of money. Of course, you do need to be careful to do this in a professional manner.

Be sure to have the right coverage

You also need to be sure you have the right coverage for your business. For example, you want to make sure your business is covered for the total amount of money needed to cover your business. And, of course, you want to make sure you have enough coverage for your business and its assets. You may be surprised at how little coverage you need for your small business. That’s why you want to make sure you complete a business evaluation and find out exactly what is covered with your current policy.

Stay up to date on changes in laws and regulations

The laws and regulations that govern the insurance industry are constantly changing. The government and the insurance industry are always looking for ways to save money and make things easier. As a small business owner, you need to stay up to date on these changes, as well. Make sure you’re registered with all of the appropriate state and federal databases, including your tax and business registration information. That way, if you ever need an official document, you won’t have to worry about finding or filling out the correct paperwork.


Many small business owners choose to self-insure their risk, but this can be dangerous and irresponsible. When you don’t have the experience or knowledge to properly assess your risks, you could put your entire business at risk. Some of the most common insurance coverage for a small business includes property insurance, business interruption insurance, and workers’ compensation insurance. These three types of coverage are often included in a single policy. You can also save money on insurance if you know what you’re looking for and shop around for the best rates. You can also negotiate with your insurance agent and broker to get a better rate on your policy. When you know what you want out of your policy, you can make sure you’re getting the coverage you need at the best price possible.

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