Most Common Property & General Liability Claims for Small Business
- Burglary & Theft
- Damage from Water & Freezing
- Damage from Wind & Hail
- Fire Damage
- Customer Slip and Fall
- Exposure to risk: If your business is operating in an industry that has high levels of risk, your general liability insurance premium can be higher.
- Business location: Your business’s geographical and specific location can affect your insurance premium. For example, a highly populated city could increase the likelihood of a bodily injury claim, which would have an impact on your premium.
- Years in business or the industry: How much experience you have can factor into how much you pay for an insurance premium. If you’ve been in business for a long time and have been experiencing growing revenue, this could affect your premium.
- Type of business: Some businesses operate in industries that are riskier than others. For example, a contracting business is involved in risky work and may pay a higher insurance premium than a similarly sized accounting firm.
- Your deductible: The deductible amount you choose for your insurance policy has an impact on the premium. If your deductible is higher, you may pay a lower premium than a policy with a lower deductible.
Most Costly Property and General Liability Claims for Small Businesses
- Reputational harm: The average costs for claims of reputational harm are $50,000.2 These claims include financial damages from libel, slander, defaming products or services, or violating privacy.
- Vehicle accidents: Vehicle accident claims cost an average of $45,000.3 This includes accidents involving employees of a small business owner who uses their personal vehicles for business purposes. This average cost can be higher if the claim leads to a lawsuit.
- Fire damage: Claims of fire damage cost an average of $35,000.**
- Product Liability: The average cost of a product liability claim is $35,000.4 This may apply to injury or damage arising out of the use of a covered product.
- Customer injury or damage: The average cost of a customer injury or damage claim is $30,000.5 This includes damage to the customer’s property and injury to the customer caused by the small business owner.
Tips for Preventing the Most Common Claims and Costs
Source: The Hartford, “General Liability Insurance Cost” https://www.thehartford.com website. Accessed November 10, 2020. https://www.thehartford.com/general-liability-insurance/how-much-does-general-liability-cost
© Copyright 2020. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.