What is the Average Cost for General Liability Coverage?

What is the Average Cost for General Liability Coverage?

General Liability Insurance provides coverage for many risks associated with small business; such as customer injury, customer property damage, etc. It also protects your business in lawsuits. Furthermore, this policy can help you qualify for various leases and contracts. This policy is too valuable for any small or mid-sized business.

Note: Get Access to the Best General Liability Insurance Near Me.

Does Your Business Require General Liability Coverage?

Most small businesses require this insurance policy to function without worrying over risks. There are also many clients hesitate to assign a contract without this policy.

Almost every business which directly works with clients benefit from the General Liability Coverage. It can maintain stability in your business even if you are dragged through some legal procedure by a disgruntled client.

It is generally accepted by most business analysts that this is one of the most important insurance policies for business owners. That is why, you must look into buying it right after you start your business.

The Cost of General Liability Coverage

General Liability Coverage does not cost as much as you think. Its pricing depends on many factors. Chief among those factors are the usual liabilities associated with your business, policy limits, etc.

Regardless of the policy limits, the median cost of General Liability Coverage is $42 per month. It comes down to around $500, annually. The purpose of mentioning median costs, instead of average costs, is to give a more accurate estimate. A median cost excludes outlier higher and low premiums, that is why its estimates hold more water.

  • Majority of businessowners, (i.e. 48%), pay between $300 and $600 annually for their respective policies. 
  • 17% businessowners pay less than $300 annual premium.
  • 20% of the Larger, or riskier businesses pay more than $900 for the policy.

These figures are derived from a detailed analysis of the thousands of insurance policies sold by SG Financial Inc.

Industry Risks and Their Impact

The costs of General Liability Services have great dependency over the type of industry. Every industry carries different levels, or potential for risks. A brewery has naturally fewer potential risks than a pharmaceutical company. that is why, this policy costs more for high-risk industries. The low-risk industries can enjoy the insurance policy for much lesser costs.

A retailer of brick and mortar can face too many liabilities. Slight carelessness can cause serious injuries and property damage. On the other hand, a Web Developer working from a home office has a pretty safe business. That is why, the businesses associated with construction industry pay highest premiums. Whereas, the businesses associated with IT pay some of the lowest premiums in the market.

Similarly, businesses associated with contracting, or even cleaning services and landscaping also have high costs for General Liability. The main reason for such expensive policy is because these industries often do their work on someone else’s property. The insurance policy can pay for damages to a client’s property, caused by you, or your employees.

Effects of Coverage Limits on General Liability Insurance Cost

The amount of coverage you want helps determines the costs of your policy. This is a universal truth for every insurance policy. The same principle holds true for General Liability Coverage. If you want better coverage, you will pay higher premiums. The most popular form of general liability is the $1 million / $2 million policy. This includes;

  • $1 Million Occurrence Limit. The insurer will pay up to $1 million to cover any single claim.
  • $2 Million Aggregate Limit. The insurer will pay up to $2 million to cover claims.

The majority of our clients choose a policy with $1 million / $2 million limits. A minority choose a policy with $2 million / $4 million limits; i.e. the next most popular choice.

Cost Saving Tips

Firstly, the best tip for saving costs is to buy several policies in a bundle package. A Business Owner’s Policy is one of the best examples for this idea. By purchasing multiple policies in a single package, you can gain discount from the insurance company. Low risk businesses often get immediate approval for bundled policies.

Secondly, pay your complete premium upfront for your General Liability Coverage. The policy buyers have the option of paying their premiums on a monthly, or annual basis. The monthly installments may tempt you. But you should consider paying the full premium. The insurance agencies offer various discount packages for full payments. It will prove beneficial to you in the long run.

Finally, manage your risks proactively. You must remain cautious and actively take steps to minimize the risks. The businesses with clean claims history are always charged lower rates. You can gain this significant advantage by creating a comprehensive risk management plan. Following are a few suggestions for the development of such a plan;

  • Thoroughly train your employees to decrease the risk of human error
  • Do not hesitate to spend money on development of a reliable security system
  • Compile and follow rules for social media posting
  • Develop a proper check and balance system
  • Make an effort to minimize hazards on your business premises
  • Educate yourself on common business insurance costs
Protect Your Business with the Best General Liability Coverage in Texas

Insurance premiums vary based on the policies that a business acquires. SG Financial Inc. can provide you with the Best General Liability Coverage in Plano, Texas. We are committed to providing the policies which allow for maximum coverage in smallest possible contributions. Countless clients have entrusted their protection to us. We have yet to fail their trust. Buy our low-priced policies and trust us to protect you as well.