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The Best Business Insurance Providers of 2021

By
Nicole Urbanowicz
,
business.com Contributing Writer
| Updated
Feb 08, 2021

Business.com is the most popular review site for business liability insurance. Compare service features and prices to make your buying decisions easy.
Best for Workers' Compensation
The Hartford
Multiple payment options
File claims by phone or online
Wide medical provider network
Best for Small Business
Chubb
Multiple liability policies
Claims can be filed 24/7
Operates in 54 countries
Best for Professional Services
AIG
100 years in business
Customizable E&O policies
ReputationGuard services
Best Low-Cost
Thimble
Buy on demand
Quick quotes
Cancel at any time
Best for Risk Assessment
CNA
Advanced risk assessment tools
Serves businesses of all sizes
Vast array of insurance policies
Business.com is the most popular review site for business liability insurance. Compare service features and prices to make your buying decisions easy.
Updated 02/08/21

This page has been updated with details of a new report, which highlights why a growing number of small businesses may be adding cyber insurance to their policy portfolios in 2021.

The best business insurance gives you peace of mind that, when something goes wrong, you have the coverage and a provider that will support you through the entire process, from filing the claim to getting your funds. To find the best business insurance for small businesses, we researched more than two dozen options, looking specifically at the types of policies they offer, their claims processes and other features.

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How We Decided
Our team spends weeks evaluating dozens of business solutions to identify the best options. To stay current, our research is regularly updated.
18
Considered
8
Researched
5
Selected

Compare Our Best Picks

  The Hartford Chubb AIG Thimble CNA
Liability coverage
limits

$2 million for each incident; $4 million aggregate

Up to $2 million per occurrence; $4 million aggregate; up to $4 million completed operations; up to $1 million employers liability Small business excess casualty: lead coverage with limits up to $10 million for companies with revenues up to $25 million; cyber insurance up to $100 million $1-$2 million $1-$4 million
Method of filing
claims
Phone, online Phone, online, local agent Phone, online Email, phone, online Phone, fax, email, online
Liability coverage
types
General, employment practices, professional, management, cyber  General, professional, management, privacy, foreign general, medical, cyber, casualty, property  General, professional, management, cyber, casualty, property, foreign, specialty accident and health; kidnap, ransom and extortion insurance General, professional, drone coverage  General, employment practices, cyber, media, drone coverage, professional and fiduciary
Workers'
compensation
Yes Yes Yes No Yes

Our Reviews

The Hartford: Best for Workers' Compensation

Employees have access to a preferred medical provider network with more than 1 million health professionals.
Injured employees can access prescriptions for no out-of-pocket costs from 6,500 pharmacies nationwide.
The Hartford is not an accredited member of the Better Business Bureau.

While laws vary by state, most businesses with at least three employees are required to have workers' compensation insurance. This type of insurance protects businesses against potential lawsuits by employees injured on the job. Most insurance providers offer standard workers' compensation coverage, but some offer additional services.

The Hartford is one of those insurers. It provides pay-as-you-go billing and multiple resources for employees who are injured at work. For example, it allows them to tap into a network of more than 1 million medical providers who specialize in workplace injuries, to fill prescriptions with no out-of-pocket expenses at 65,000 pharmacies nationwide, and to access nurse case managers who coordinate all of the treatment and care. For these reasons and more, The Hartford is our choice as the best insurer for workers' compensation insurance.

Employees are responsible for filing workers' compensation claims. They can do so by filling out an online claim form on The Hartford website or contacting a Hartford representative over the phone. Claims can be filed 24/7.

The Hartford provides small businesses with a wide range of other insurance coverage types. This includes general liability, business income, commercial auto, commercial flood, commercial property, umbrella, data breach, employment practices liability, home-based business, management liability and professional liability.

Read The Hartford Review

Chubb: Best for Small Business

Chubb offers liability coverage up to $4 million, and you can add an umbrella policy up to $10 million.
Besides general liability coverage, Chubb offers management, professional, privacy, foreign general, liquor and medical liability policies.
Chubb is not an accredited member of the Better Business Bureau.
When choosing a liability insurance provider, small businesses want an insurer that has all of the policies they need, provides the right amount of coverage and makes it easy to file claims. Because it has these qualities and more, Chubb is our choice for the best business liability insurance provider. Chubb offers small businesses general liability insurance in two ways: as a stand-alone plan or as part of a business owner policy (BOP). The BOP combines liability insurance with several other insurance policies that can be tailored to your needs. Some of the policies that can be in a BOP are general liability, professional liability, privacy liability, foreign general liability and liquor liability. Chubb's BOP offers liability coverage of up to $4 million. You can add on umbrella policies for further coverage up to $10 million. The factors Chubb looks at to determine insurance rates for small businesses are individual risk exposures based on business classification, building construction and the amount of insurance coverage being requested. Chubb's digital marketplace gives local agents the ability to quickly offer small businesses a comprehensive solution that covers all of their insurance needs. The digital marketplace allows agents to provide small businesses with rate quotes and speeds up the underwriting process. You can report a claim 24/7 by telephone or fax, online, or through a local Chubb agent.
Read Chubb Review

AIG: Best for Professional Services

AIG offers coverage specifically to protect businesses when their reputation is damaged.
You can receive a quick price quote on the AIG website.
AIG is not an accredited member of the Better Business Bureau.

With over 100 years of experience in the insurance space, American International Group (AIG) stands out for its variety of specific professional liability insurance and its numerous industry-standard liability policies, including general liability, commercial property, accident and health, and workers' compensation. The average cost of AIG's insurance policies ranges from $59 to $137 a month, based on your risk and other factors related to your small business.

Read AIG Review

Thimble: Best Low-Cost

You can obtain a rate quote from Thimble in a couple of minutes thanks to its use of AI.
Thimble's AI technology can suggest different coverage options based on your type of business.
Thimble isn't available in New York or Washington state.
Thimble makes liability insurance simple and affordable for over 140 types of small businesses. Answer as few as three questions, and get a quote in 60 seconds. After purchase, get your Certificate of Insurance instantly, and make changes to your policy in real time with our easy-to-use app.
Read Thimble Review

CNA: Best for Risk Assessment

In addition to general liability coverage, CNA offers employment practices, management, cyber, media, professional and fiduciary liability policies.
You can file claims 24/7, 365 days a year, by phone, fax, email or online.
CNA has several one-star reviews on the Better Business Bureau site.

With more than 120 years of experience, CNA is one of the largest U.S. commercial property and casualty insurance companies. It provides a wide range of standard and specialized property and casualty insurance plans to more than 1 million businesses and professionals in the U.S. 

CNA stands out with its targeted approach to risk assessment, including its focus on risk allocation and risk control teams. For instance, CNA Risk Control consultants guide you through the time you enter into a contract with an outside entity (a subcontractor, tenant or service provider), which creates a new set of risks and liability issues. The agents can help you with the contractual risk transfer.

CNA also features PrepWise, which helps with risk assessment. This includes CyberPrep, which focuses on a business's cyber risk in particular and is available to all CNA cyber policyholders. According to the company, CyberPrep is modeled on industry-leading cybersecurity frameworks for standards, guidelines, and best practices, including the National Institute of Standards and Technology (NIST) Cybersecurity Framework.

To help insured companies identify the strengths and weaknesses of their cybersecurity, the CNA eRiskHub web portal offers security recommendations, and a team of professionals is deployed in the case of a data breach.  

Another unique offering CNA has is the School of Risk Control Excellence (SORCE). Customers can access training and other resources, such as on-demand seminars, to minimize their risk exposure and add to risk-management practices to reduce their liability. For instance, CNA offers risk assessment and reduction training for lawyers, HR, dentists, and accountants, to name a few. There is a separate charge of $14 to $40 for certain courses.

Types of Insurance

CNA gives small businesses numerous options for liability insurance, with general liability insurance at the center. Typically, CNA offers general liability insurance as part of its business owners policy. Called CNA Connect, this policy combines general liability with other types of coverage small businesses may need, including property, business income and equipment breakdown insurance.

With CNA's general liability insurance, coverage of up to $2 million for a single incident and up to $4 million for all incidents is available, although polices and coverage can vary based on a number of factors.

CNA also offers various forms of management liability insurance, including employment practices liability, which covers employers from employee claims alleging discrimination, wrongful termination and harassment. Coverage of up to $500,000 is available for employment practices liability insurance.

CNA also offers other types of liability insurance, including cyber, media, professional (E&O) and fiduciary liability. For miscellaneous professional liability and technology E&O, CNA provides policies for small businesses that can cover up to $5 million in damages.

The rates for each liability product are based on the unique drivers of risk exposure of that type of insurance, the type of business being insured, and the location of the business, among other factors. For example, when determining rates for your general liability, CNA may consider how many square feet your business occupies, your revenue, type of business, location of business and number of employees. Only the relevant insurance policy can provide the actual terms, coverage, amounts, conditions and exclusions.

Other types of insurance available from CNA are property, commercial auto, crime, international and marine insurance. Its umbrella and excess coverage, CNA Excess Casualty, can offer up to $25 million on either a lead or excess basis.

It even offers workers' compensation insurance. The rates are usually determined by rating bureaus, such as the National Council on Compensation Insurance or independent state rating bureaus, and approved by the individual state departments of insurance. However, CNA has some ability to deviate from these regulated rates based on your company's overall loss experience, business type and location.

Ease of Use

CNA lets you get an immediate quote on its website. After indicating the type of coverage you are looking for, you answer several questions about your business, its location and your employees. You receive a rate quote as soon as you answer the questions.

The CNA website also gives you several ways to connect with a local agent. You can search for one by location, or you can fill out some information about your business to be matched with an agent who can best serve your needs. You can also contact CNA directly by phone or email.

Claims Process

Policyholders can file claims 24/7/365 by phone, fax, email or online form. CNA has regional offices throughout the U.S., Canada, and Europe, with claim professionals who provide expertise and specialize not only by type of business, but also by claim type and severity.

CNA leverages advanced analytics and technology to ensure it has the right people performing the right tasks throughout the claims process.

Customers have access to a number of in-house resources, including litigation counsel, special investigations and recovery. The special investigations unit can identify, investigate, and pursue fraud, using predictive models and machine learning to help resolve claims.

The company's recovery services team pursues recovery opportunities against parties who were responsible for any losses. It uses predictive analytics tools and dedicated resources to identify areas of recovery and reduce costs, which can result in lower premiums.

Unlike several of the insurance companies we researched, CNA is an accredited member of the Better Business Bureau with an A+ rating.

More

Buying Guide

How to Choose Business Liability Insurance

There's a wide range of business insurance providers in today's market, which can make choosing the best one for your business a tough process. When looking for an insurance provider, you should take a number of factors into consideration. Here are some of the main points you should look into.

COMPANY EXPERIENCE

Not all businesses or industries face the same risks, so you'll want to look for a company that has the background and experience to handle insurance for your type of business. Also look for customer testimonials. If you expect your business to continue growing, consider whether the company offers coverage that can grow with you. 

COVERAGE

Many companies sell general liability business insurance, but it can be challenging to determine the type of coverage you'll need. Consider the risks you face in your business; different types of businesses have different risks. For instance, a medical practice would need more coverage than an arts and crafts supplier.

If you have a high-risk business, seek out insurers that offer excess insurance or umbrella policies to expand your coverage. These will cover you if a claim against you exceeds the amount of your general liability policy. These are a couple of the questions you should ask yourself and/or the insurance provider in your research process:

  • Can the insurer provide enough coverage for all of your assets' liabilities as well as damage?
  • Is the provider's liability insurance adequate for your business's risks?

If you are a contractor or perform projects for other companies, it's important to check with your client about insurance. A contract for which you perform work may require a certain amount of insurance coverage or an umbrella policy, or sometimes a company will add you to its general liability policy to be insured on a specific project. Some businesses are required by state law to carry certain types of liability insurance, so check your state's requirements. 

CLAIMS PROCESSING

You want an insurer with a proven record of settling claims quickly and fairly. Check an insurer's claims process to see if it offers several options, including online tools, to submit and track a claim. The more options for submitting a claim, the better. The insurer's track record for how quickly it processes claims is also important.

You also may want to make sure the insurance provider lets you file claims 24/7. Should something happen on the weekend or late at night, you don't want to have to wait to start the claims process.

Read testimonials from people who have been through that insurance company's claims process. The insurer should have a history of high customer satisfaction. Business liability insurance companies should be responsive and supportive should you ever need to file a claim.

Benefits and Importance of Business Insurance

Business liability insurance is a critical policy for most businesses. It protects you from a wide variety of potential issues. Specifically, these policies cover bodily injury to others who come into your business. This could be a customer in your retail store or a client in your office. General liability insurance also protects against damage to the property of anyone who comes into your store, office, plant or any other type of business location. In both of these instances, the business liability insurance can cover any legal or medical costs you incur.

Besides protection against claims from clients, customers, and other visitors to your business, business liability insurance protects against advertising injury. This means claims of false advertising, libel, slander or copyright infringement. For example, if you put out an ad that mentions one of your competitors in a bad light and they sue you with a claim that the ad negatively impacted their business, your insurance can cover the costs of defending yourself.

Whether you win or lose, such lawsuits can be extremely costly and time-consuming, taking your focus away from generating revenue. This can be devastating for a small business, so general liability insurance is extremely important. Small business liability insurance allows you to focus on your business even when you're facing a claim of damage, injury or negligence.

Another benefit of business liability insurance is protection against damage to property you rent. If equipment or other property is damaged by fire, lightning, or an explosion, your insurance will cover the costs.

There are several other types of liability policies that some businesses may benefit from.

  • Professional liability insurance: As we discussed above, this is designed for businesses that provide professional services for clients. Also referred to as E&O insurance, this type of policy covers businesses that are being sued for negligence in the services they provide. Basically, professional liability insurance covers businesses that are sued for making a mistake with a client, whether the claim is founded or unfounded.

  • Management liability insurance: This is designed to cover businesses in instances where managers are sued for things like breach of responsibilities or wrongful termination. It includes more specific policies like directors and officers (D&O) liability, fiduciary liability, and employment practices liability.

  • Cyber liability insurance: This protects your business from the expenses associated with incidents like computer hacks and data breaches. Research from Chubb shows the importance of cyber liability insurance. According to the Chubb Cyber Index, the number of cyber incidents that have impacted businesses has increased by more than 500% since 2012. Social attacks like phishing scams and blackmail account for 21% of all incidents since 2009. Errors, hacking and malware were the other top causes of cyber incidents over the past 11 years.

When you're deciding which types of liability insurance you may benefit from, the first thing to consider is your type of business. How large is your organization? What is its legal structure? What industry are you in? Where is your business located? Answering all of these questions will help you determine which liability policies you need to properly protect your business.

You don't have to figure this all out on your own. Don't hesitate to talk to various insurance agents to get their take. Give them the details of your business and how it operates, and they will make recommendations based on their industry expertise.

Types of Small Business Insurance

There are various types of small business insurance besides general liability.

Professional Liability

Professional liability, commonly known as errors and omissions (E&O) coverage, insures small businesses for claims of actual or alleged mistakes that cause financial harm to a third party or a failure to provide a service. There are specialized E&O insurance plans for professionals such as architects, attorneys, insurance agents, consultants, accountants and media producers.

Product Liability

Product liability covers a business, such as a product manufacturer, against third-party claims of bodily harm, illness or damage related to the business's product. This can extend to individual parts or components that your small business manufactures.

Commercial Property

Commercial property insurance covers accidental damage to your small business's property. This damage could be from things like a fire, storm, burglary or vandalism. 

Business Interruption Insurance

Business interruption insurance helps support small businesses with commercial property insurance in the event of halted business operations and/or relocation of a business related to an event like a fire or storm.

Crime and Financial Liability

Crime and financial liability policies cover losses due to theft of business property, which can include stolen money, employee financial fraud, workplace violence, electronic and computer crime, and kidnap, ransom or extortion.

Cyber Insurance

Cyber insurance isn't usually included in general liability, professional liability or property plans; it is often sold separately to businesses. Cyber insurance can protect against numerous cyberattacks, such as data privacy breaches, cybercrime, malware and ransomware.

What Does Business General Liability Insurance Cover?

The specifics of your general liability insurance coverage will be detailed in your small business's particular policy, but in general, it covers property damage (including to a third party's property), bodily injury (such as slip-and-fall incidents on your premises), legal costs, medical expenses, and personal and advertising injuries that would be damaging to a business's reputation. On that last point, there are also specialized reputation coverage packages that expand protection in this area, with liability limits of up to $5 million.

Excess liability coverage is available in a number of areas. This goes beyond general liability insurance, offering additional protection and raising the coverage limit for certain areas of your policy.

Overall, general liability insurance underwriters look at your business's size, location, years in operation, scope of operations, and insurance claims history to assess your small business for risk.

Community Expert Insight

As part of our research on the best liability insurance providers, we reached out to small business owners to find out what they look for in policies and providers. The small business owners we heard from said industry-specific coverage options and insurance for cyberattacks and data breaches top their lists of must-haves.

Eunice Sosa is the CEO of Sosa & Arvelo LLC, which provides accounting, tax, business and technology advice. She said that small businesses face more cyberthreats than people might think, and that small companies often don't realize the amount of data they are storing.

"Cyber insurance is what [businesses] need to be looking for," Sosa told business.com. She put cyber insurance at the top of her agenda due to her line of work.

Sosa said her company has used or considered Chubb and Travelers because their policies contain cyber coverage, and they offer personal attention for small businesses and "grow with you as well,” which is key for growth-oriented companies seeking flexible policies.

Selmin Karatas, co-founder and CEO of Kazani Beauty, said finding adequate coverage for the right price was her top priority when searching for an insurance provider.

"I wanted to sell at Whole Foods, and you need at least $2 million in coverage there," Karatas said.

She said this is why she opted for a policy from Great American Alliance Insurance Company, which covered specifics for product manufacturers such as finished product liability, warehouse liability (property damage, personal injury coverage and medical expenses) and onsite liability within the range she needed.

Business Insurance FAQs

WHAT IS COMMERCIAL GENERAL LIABILITY INSURANCE?

Commercial general liability insurance is another name for business liability insurance. It covers a wide range of potential issues, including injuries to people other than your employees who enter your store or workplace, and damage that may occur to their property there. It also protects you against lawsuits that might come your way should one of your ads cause harm to a competitor. This coverage includes claims of libel or slander.

This type of coverage is necessary for most businesses, as it provides protection and coverage against many possible issues.

WHO NEEDS BUSINESS LIABILITY INSURANCE?

Nearly all businesses, regardless of industry, should have some level of business liability insurance. It can cover your business in many different scenarios, such as if a customer is injured inside your store or if your products cause bodily harm to someone.

All businesses can benefit from this layer of protection to help cover defense fees or potential judgments. Like other types of insurance, general liability is something you hope you never have to use, but if you don't have it if and when you do need it, you could put your business in serious jeopardy.  

HOW MUCH GENERAL LIABILITY INSURANCE COVERAGE DO YOU NEED?

This depends a lot on the type of business you have. Insurance providers offer a range of coverage amounts, from $100,000 to $2 million for one instance and $4 million for all instances. Many providers offer umbrella policies that can increase that amount to as much as $10 million.

You need to take a number of factors into account to determine how much coverage you need from your insurance policy. Your industry, location, revenue, number of daily visitors and type of workplace (e.g., a retail outlet, office or manufacturing plant) will help you determine the right level of coverage for your business.

HOW MUCH DOES GENERAL LIABILITY INSURANCE COST?

Like the amount of coverage you need, the cost of general liability insurance depends greatly on the type of business you have. Your company's risk exposure, size, building construction, requested coverage amount, geographical location and number of employees, among other things, all factor into the rate you'll pay for liability insurance.

Many insurance providers offer online quotes, meaning you can fill out some information about your business on their websites and receive estimates of your insurance rates instantly. This is an easy way to shop around for your insurance. When filling out these forms on some insurers' websites, we found prices ranging from about $450 to $700 per year for liability coverage of $1 million for a retail store.

DO YOU REALLY NEED BUSINESS INSURANCE?

The quick and easy answer to this question is yes. Besides the fact that it protects your business from various claims that may come your way, some types of business insurance are required by law. Specifically, if you are hiring employees, many states require you to have workers' compensation insurance. Barring that, it really comes down to choosing the insurance policies that are right for your business. At a minimum, all businesses should carry some liability insurance as well as property insurance.

WHY DOES A BUSINESS NEED LIABILITY INSURANCE?

Businesses need to be able to protect their assets and financially deal with potential legal issues. Liability insurance can shield your company from those costs, which is helpful in the event that your business is sued, whether it's a third-party lawsuit, a slip-and-fall accident, or another incident that has the potential to hurt your business.  

DO YOU NEED BUSINESS INSURANCE FOR AN LLC?

While your personal assets may be protected if you own an LLC, you still need business insurance, especially general liability coverage. Even though a potential lawsuit against your business may spare your personal assets, you are still putting your business in serious risk if you don't have business insurance. An LLC faces much of the same dangers as businesses with other structures, so you should still protect it with the proper insurance policies.

IS OWNING AN LLC CONSIDERED SELF-EMPLOYMENT?

Yes, if you own an LLC, you are a self-employed individual. LLC owners, called members, are required to pay self-employment taxes. 

WHAT HAPPENS IF SOMEONE SUES AN LLC?

If your LLC is sued, your business generally assumes the liability of the judgment, and you, the business owner, will not be held liable – meaning that your personal assets or bank account will be safe from any impact of the lawsuit. However, there may be exceptions if your LLC wasn't formed or managed correctly, if you mixed your personal and business finances or assets, or if you signed contracts with personal guarantee clauses.

HOW MUCH DOES LIABILITY INSURANCE COST FOR A SOLE PROPRIETOR?

It is especially important to get liability insurance if you are a sole proprietor, because the legal responsibility for your business rests solely on you. The cost of general liability insurance varies wildly depending on the specifics of your business – it could be anywhere from $500 to $15,000 annually – so you'll need to call at least two providers to get an idea of what you can expect to pay. The factors that affect price include your type of business, the state you do business in, your annual revenue, and whether you have past insurance claims.

WHAT IS NOT COVERED BY GENERAL LIABILITY INSURANCE?

General liability insurance only helps you with third-party lawsuits that involve customer injuries (including product and/or advertising liability) or property damage. For instance, if you or your workers get into an accident or damage company vehicles, your business liability policy will not cover it. It will not cover damage to your business if you or your employees caused the destruction. However, if a customer destroys your property, the liability policy will likely cover it.

Employee accidents (like a slip-and-fall incident on your premises) aren't covered – you'll need workers' compensation for that – but if a customer hurts themselves in your establishment, your liability policy may help pay for their medical fees.

WHAT ARE THE DIFFERENT TYPES OF LIABILITY INSURANCE?

Several kinds of liability insurance are available for small business owners:

  • Commercial general liability protects your business against claims of property damage, bodily injury, and reputational or advertising harm.

  • Directors and officers (D&O) liability protects the personal assets of those in these roles (and their spouses) against claims by employees and customers.

  • Professional indemnity insurance protects business owners who provide guidance or other professional services against lawsuits accusing them of errors.

  • Cyber risk insurance covers your business's liability for damages or losses due to a data security breach and mitigates recovery costs.

  • Commercial crime insurance protects you against damages due to insider threats, like employees who have stolen money or forged documents. 

WHO GETS PROFESSIONAL LIABILITY INSURANCE?

Professional liability insurance is essential for small business owners and independent contractors who provide professional services. Accountants, lawyers, doctors, architects, engineers, insurance agents, and other professionals looking for protection against claims of negligence should get this type of coverage.

Specific types of professional liability insurance include medical malpractice insurance, which protects doctors, and E&O insurance, which is used by professionals who provide advice or services.

Is general liability insurance tax deductible?

In general, yes. According to the IRS, you can deduct "the ordinary and necessary cost of insurance as a business expense, if it is for your trade, business, or profession."

Methodology

To determine the best business liability and workers' compensation insurance companies, we started with a list of 18 providers. We then visited each company's website for some initial research.

Next, we focused on some of the bigger insurance companies and eliminated companies that are just insurance brokers, which work with businesses to find them the best coverage and rates for their needs.

We focused our examination of this narrower pool on several factors:

  • Liability insurance options
  • Workers' compensation insurance
  • Other insurance options
  • How rates are determined
  • Coverage amounts
  • The claims process
  • Better Business Bureau ratings and complaints

Workers' Compensation Insurance

Another piece of insurance that all employers need is workers' compensation. Workers' comp protects employers against potential lawsuits and provides payouts for injured employees.

Depending on your industry or the number of employees you have, you may be required to have this type of insurance. It could be the difference between an insurance payout for a worker injured on the job and an expensive lawsuit that forces your company into bankruptcy.

Workers' comp has built-in protections. It can often prevent a third party from suing you in the event of an employee injury. Let's say, for example, that one of your workers is injured while using a heavy piece of machinery. If that worker sues the machinery company, workers' comp can protect you from the machinery company suing you in turn. This is a basic example, of course, and legal situations are often more complex. The key takeaway is that workers' comp can serve not only as a benefit to your employees should they be injured, but also as a safeguard for your business.

Each state has different legal structures for workers' comp. Some states require you to have it; others let you enroll at your own discretion. The cost structure also varies by state. Depending on your industry and state, you should expect to pay 1% to 4% of your total payroll for workers' comp insurance.

Despite laws in place around workers' comp, Insureon found that only 17% of small businesses it surveyed were enrolled in it. If you don't have workers' comp or haven't even thought about it, you should consider it, both to benefit your employees and to protect your business.

What to Expect in 2021

With limitations on physical interaction continuing into at least part of 2021, insurance companies will lean heavily on new and advancing digital tools. The accelerated development of digital offerings will be both the central product and methodology for insurance services in 2021. The advancement of digital tools in this space will benefit customers by giving them more control of their coverage options. Businesses will be able to enjoy faster and simpler insurance experiences with potentially lower rates in a period of economic recovery.   

Many of these benefits will stem from 2020's widespread adoption of cloud computing and advanced algorithms. Necessity pushed advanced tools such as artificial intelligence and virtual reality from experimental to essential, and all of these innovations facilitate segmented plans to best suit each purchaser. With an expanded network of customer data available, insurers can design premiums and coverage options with unprecedented customization.

The shift to mobile and remote touchpoints also enables customers to alter plans at their convenience. All of this collected data, alongside the advancements in artificial intelligence, can help resolve cases faster with less risk of fraud.  

A potential downside for the 2021 business owner might be the need to add cyber insurance coverage. Cyber insurance is the fastest-growing insurance offering thanks to the increased reliance on data in all industries. Businesses face an increased risk of cyberattacks. With more businesses relying on their digital operations, we at business.com expect more companies to adopt strong cybersecurity policies to provide some protection should they fall victim to a malicious data breach.

February 2021: New research from insurance provider Chubb and Microsoft details just how big of a problem email cybercrime has become, highlighting the importance of cyber insurance for businesses. In the report, Email: Is the Digital Door Propped Open for Identity Hijackers?, the authors noted that in 2019, the FBI received more than 460,000 complaints of online scams that resulted in losses of more than $3.5 billion to individuals and businesses.

One area of growing concern is called "business email compromise," which is when criminals hack into a business's email account, impersonating an owner or executive in an effort to defraud the company or its partners and clients. One such scam resulted in $75 million being redirected into a hacker's bank account.

While the report notes that multifactor authentication can reduce these crimes, the data also highlights why small businesses, which are the victims in 25% of these scams, should seriously consider purchasing cyber insurance. As these scams become more prevalent and damaging, we expect a growing number of businesses in 2021 to add cyber insurance to their existing policies (such as workers' compensation, general liability and property insurance).

Nicole Urbanowicz
Nicole Urbanowicz
business.com Contributing Writer
Nicole Urbanowicz has worked as an editor/writer covering the finance, insurance, retail, cosmetic science, and travel industries for a number of publications. Her articles have appeared in The Wall Street Journal, Dow Jones Newswires, Associated Press, CNN Money, Yahoo Finance, WWD, and Travel Weekly, to name a few. Nicole has a master's in finance from Harvard University and a bachelor's in journalism from Boston University, and she works as an independent contractor in various industries. She is a former life and health insurance agent-producer. Nicole recently produced a YouTube series on the pandemic and its impact on businesses and the real estate market. She is based in New York City.
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