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By Ana Reina
Updated: January 19, 2021 11:36 AM ET | Originally published: July 13, 2020
two hands hold a small business in their hands Money's Best Business Insurance 2021
Money; Getty Images

Opening your own business is exciting but it doesn’t come without risks.

That makes business insurance a smart, if not an essential, buy.

Without coverage, your enterprise and its assets will be vulnerable should the worst happen.

6 Best Small Business Insurance Companies

Here are Money’s top 6 picks for the best business insurance of 2021:

  1. The Hartford: Best Comprehensive Option
  2. Nationwide: Best for General Liability Insurance
  3. Progressive: Best for Commercial Auto Coverage
  4. CyberPolicy: Best Option for Easily Comparing Policies
  5. Thimble: Best for the Smallest Businesses
  6. Hiscox: Runner Up for the Smallest Businesses

We’ve reviewed the offerings in this market and narrowed down the best options to protect your enterprise. Our selections were determined mostly by three major factors:

  • range of coverage options
  • business types and sizes covered
  • the ease of applying for a policy and submitting a claim.

(Here’s more on our methodology.)

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The Hartford: Best Comprehensive Option

Hartford stands out by combining general liability, business property insurance, and business income insurance through its Business Owner’s Policy (BOP.)

This package includes coverage for which other insurers charge extra, including protection from loss of income caused by fires, destructive winds or burglaries, bodily injury or property, and personal and even advertising injury.

Besides the Business Owner’s Policy, small business owners can buy add-ons to cover such perils as data breach, debris removal, and loss of valuable paper records.

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Other coverage offered:

  • Liability for employment practices
  • Commercial floods
  • Home-based businesses


  • Online quotes available for 51 professions across 24 industries
  • Claims can be filed online


  • No online chat available to assist with application process
  • Doesn’t offer coverage in Alaska or Hawaii

Nationwide: Best for General Liability Insurance

Like most major commercial insurers, Nationwide offers a wide array of products, including business owners’, business liability, commercial property, and commercial auto insurance policies.

Where this insurer stands out, however, is in its flexibility in adding general liability coverage to other policies.

While this coverage can be purchased in stand-alone policies, Nationwide also offers coverage add-ons for commercial crime, business income, inland marine, and builder’s risk, among others.

Other coverages offered:

  • Employee practices liability
  • Equipment breakdown
  • Accounts receivable


  • Claims can be filed online
  • A.M. Best rating of A+ Superior for financial stability and ability to pay out claims


  • No online chat

Progressive: Best for Commercial Auto Coverage

Apart from being the No. 1 commercial auto insurer by direct premiums written in America, according to the National Association of Insurance Commissioners, Progressive shines in its commercial auto policy offerings.

The company’s customization options for commercial auto are the most thorough on the market, with many Progressive commercial auto endorsements to choose as additions to your policy.

Common types of business vehicles you can insure with a Progressive commercial policy are business cars, sport utility vehicles, motorhome/RVs, buses, and limousines, along with auto haul-, dry freight-, flatbed-, and utility trailers.

The company also offers discounts to customers who maintain a clean driving record, have continuous auto-insurance coverage for 12 months, own an in-force general liability or business owners policy, have a commercial driver’s license, have experience as a business owner, and pay their policy in full.

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Other coverages offered:

  • Contractors


  • Wide array of discount options
  • A.M. Best rating of A+ Superior for financial stability and ability to pay out claims
  • Applications can be made online


  • No online chat
  • Policies are underwritten by third parties, which may affect the quality of customer service

CyberPolicy: Best Option for Easily Comparing Policies

CyberPolicy is a small business insurance policy marketplace that partners with the biggest players in the industry: Chubb, Hiscox, AmTrust, Liberty Mutual, Nationwide, and BiBERK.

If you need to buy insurance products quickly while comparing a variety of options, CyberPolicy provides convenient one-stop shopping. And its offerings can be inexpensive; a general liability policy starts at just $20 a month.

It’s also a helpful site if you’re not sure what kind of coverage you need. There’s a questionnaire that helps you figure out the most important insurance needs for your business. Once you purchase a policy, you can be covered within as little as 24 hours.

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Other coverages offered:

  • Fidelity and crime
  • Employment practices liability
  • Lessor’s risk
  • Liquor liability


  • Discounts available for bundling multiple policies
  • Compare quotes while you shop
  • Process is completely online


  • Offers insurance that applies nationwide, but policy offerings vary by state
  • Claims must be submitted directly through your insurance provider’s claims department, not through CyberPolicy, adding another step to the process

Thimble: Best for the Smallest Businesses

Thimble is limited; it offers only general liability insurance, professional liability insurance, and errors and omissions policies. But it sets itself apart with its speed and breadth of coverage.

Thimble offers instant coverage online for as long as you need it — hourly, daily, or monthly — and serves more than 100 types of small business professionals, ranging from personal trainers, pet sitters, and event organizers to photographers and landscapers.

Other coverages offered:


  • Coverage is instant
  • Extend or pause coverage as needed with “Thimble Monthly,” or purchase coverage hourly, daily, or weekly with “Thimble on Demand”
  • Underwrites their policies through industry veterans Markel and Global Aerospace


  • Policies not available in NY or WA
  • No online claims
  • No telephone support

Hiscox: Runner Up for the Smallest Businesses

Hiscox is another great option for self-employed or small business insurance when the business has five employees or fewer.

This insurer offers discounts of up to 5% on policies that cover only the business owner or that provide general liability coverage for home-based businesses with five or fewer employees. Additionally, there’s a 5% discount for bundling policies.

Other coverages offered:

  • Professional liability (errors and omissions)
  • Cybersecurity
  • Workers compensation
  • Umbrella liability
  • Business auto


  • Online application quotes estimates for 180+ professions across 9 industries
  • Claims can be filed online
  • A.M. Best rating of A for financial strength and ability to pay out claims
  • Policy discounts available


  • No online chat
  • Coverage not available in Alaska
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Methodology for Choosing the Best Business Insurance Companies of 2021

To select the best small business insurance providers for 2021, we spent dozens of hours researching the most popular companies and analyzing their offerings.

We emphasized three major factors in making our selections: range of coverage options, business types and sizes covered, and the ease of applying for a policy and submitting a claim.

Coverage Options

We favored companies that went beyond the norm in regard to coverage by, as examples, offering comprehensive commercial auto or coverage that kicked in instantly.

With the exception of Thimble, the companies on our list offer all of the following coverage:

  • general liability coverage
  • business owners
  • cybersecurity
  • commercial auto
  • errors and omissions
  • workers compensation insurance
  • umbrella liability coverage

Types and Sizes of Businesses Covered

The insurance carriers on our list cater to small to medium-sized companies and to over 100 professions across multiple industries. Some specialize in small business insurance while others specialize in self-employed people such as independent contractors and freelancers.

We considered only companies that cover the broadest range of workers and small businesses.

Online Features

We favored companies that facilitated hassle-free online business insurance quotes, purchasing, and claims processing.

We also gave credit to companies that, upon purchase, provide online certificates of insurance liability, whether you’re a freelancer or the owner of a growing enterprise.

What is Business Insurance?

Business insurance functions much like car, life, or health insurance. Your coverage should protect your business against unexpected events that have financial consequences — events like natural disasters, fires, accidents, lawsuits, death, and more.

As with car or life insurance, you pay for a business insurance policy while hoping you’ll never suffer any of the misfortunes it covers. Should you be subject to a financial loss, though, you’ll want coverage that adequately protects you while also being affordable.

Unfortunately, too many American businesses have no such protection. Of the more than 28 million small businesses the Small Business Administration (SBA) estimates are operating today in the U.S., about 44% have never been insured, according to Next Insurance.

Going without business insurance comes with high risks. A claim lodged against your uninsured business could eventually lead to legal seizure of assets, including personal ones you might be using to help secure loans for the business.

If those assets fall short of the amounts for which you’re found liable, you may, among other setbacks, find yourself unable to pay your employees or others the business owes money.

In short, your business may have to shut down despite its years of experience and your accomplishments as a business owner.

Do Contractors & Freelancers Need Business Liability Insurance?

Even a solo entrepreneur or independent contractor who has no employees might need to consider buying business insurance. The equipment they use, like a vehicle used for deliveries, might be damaged.

People who provide professional services may also need professional liability insurance. Even freelancers and independent contractors who never leave their living room for work should think about getting coverage for their unique needs.

Consider the work of a computer consultant, for example. What if the consultant wrote a faulty software program by mistake? If the mistake costs clients in downtime or lost data, the clients may decide to sue the contractor. The legal fees alone could dry up the contractor’s income.

Or what if a freelance writer submitted content owned by someone else by mistake, leading to a plagiarism suit?

Confidence in your own ability isn’t a reason not to insure your small business, even if funds to pay premiums may be scarce.

According to the US Bureau of Labor Statistics’ Business Employment Dynamics, about 20% of businesses fail in their first year, and a further 10% will fail in their second year. Having business insurance won’t safeguard your business from market dynamics or management mistakes, but it can help protect it from property and legal claims that could arise from its failure.

The right business insurance for you will vary depending on your unique needs: The size of your company, the industry it operates in; your business assets, revenue and number of employees; how much protection you need; and your level of comfort with risk.

The Main Types of Business Insurance

Business insurance companies offer a wide variety of choices. Deciding what kind of coverage to buy can overwhelm busy entrepreneurs who have a lot more on their plates every day.

So it may help to know most, or all, of the commercial coverage you buy from an insurance company is likely to fit into two main categories: property and casualty. Together, these two types are known within the industry by the acronym “P & C.”

Then another handful of types of coverage fit into other categories and are mostly purchased from (and often required by) governments.

Commercial Property Insurance

As its name signals, commercial property insurance covers the loss (or damage to) your business’s possessions, including its real estate and vehicles.

Add-ons can also protect you against financial losses or extra expenses you incur from having to operate the business without these possessions.

  • Commercial auto coverage: Coverage for company-owned vehicles, or any personal car that is used for business purposes.
  • Commercial real-estate insurance: Protects the company’s real estate and other physical assets from loss and damage from fire, inclement weather, vandalism, or civil disobedience. The claims payments go directly to the policy owner.
  • Business income and extra expense insurance: A frequent add-on to commercial property insurance, business income coverage protects against revenue loss due to physical damage from a fire or other calamity. Extra-expense coverage takes care of any costs above normal operational expenses as the result of property damage and some other setbacks.
  • Business interruption insurance: This coverage can help compensate you for the lost business your company suffers after property is damaged or destroyed because of a covered peril.

Here’s an example of how these coverages might cover you after, say, your offices burned down in a fire.

The business-income coverage would cover income lost when employees had to help clean up after the blaze rather than doing their regular work. Extra-expense coverage would cover the costs to rent an alternate space and move your equipment to it until the property you own is repaired and usable.

Commercial Casualty Insurance: Liability Coverage

A key area of casualty insurance is commercial liability coverage. Commonly called third-party coverage, because it covers claims filed by other people other than the insured party, this insurance protects businesses from lawsuits or other actions filed by employees, customers, clients, and visitors.

  • General liability coverage: This covers claims or lawsuits against your business due to injury, death, medical expenses, slander, libel, and damages your business is said to have caused to third parties or their property. The covered perils include but aren’t limited to, slip-and-fall accidents on your property, physical or property damage due to an accident, and damages or injuries caused by your product or finished work.
  • Umbrella liability: This is supplemental coverage that activates in the event of a catastrophic claim that exceeds the coverage provided by your primary liability policy.
  • Errors and omissions liability: Should your business give advice or create a product that causes harm to an individual company, this policy covers you. It protects you from the costs of legal fees and pays out any claim if you’re successfully sued. E&O coverage is especially common for professional service providers such as medical doctors, architects, lawyers, engineers, and accountants.
  • Key-person coverage: This coverage is also known, in more sexist terminology, as “key man” insurance. Regardless of its name, it covers any losses attributable to the business losing its owner or another key person to death or disability.
  • Malpractice insurance: Healthcare providers add this coverage in case they’re sued by a patient who blames the medical provider for a bad patient outcome.

Commercial Casualty: Insurance for Employees

A business’s casualty insurance also encompasses coverage, sometimes mandatory, that protects employees in the event they lose their job or are injured or disabled while performing it.

  • Worker’s compensation insurance: As a rule, workers comp is legally required by your state if you have employees working for you. It’s meant to cover injuries on the job, medical expenses, rehabilitation, and lost wages. It can be purchased to cover business owners as well as employees.
  • Disability insurance: Should an employee be unable to work due to injury or illness, this policy covers a percentage of their wages. In California, Hawaii, New Jersey, New York, and Rhode Island, employers are required to carry disability insurance for their employees.
  • Unemployment insurance: Much like disability, this provides employees with a percentage of income when they are not working, in this case, because they lost their job. Unemployment coverage is not purchased through an insurance carrier but is funded through mandatory federal taxes that are forwarded to state governments, who administer the program.
  • Employment Practices Liability Insurance (EPLI): This coverage can help in case an employee files a discrimination, wrongful termination, or sexual harassment lawsuit.

How to Choose a Business Insurance Policy

As with buying personal insurance, spending a little time planning your business coverage upfront can pay off handsomely. These steps can save you time and money when comparing business insurance online.

Take stock of business assets

Begin by assessing what you have to insure, advises Jeff Root, insurance specialist and owner of insurance agency Rootfin.

Make a thorough list of what the business owns, including property, equipment, and inventory. Then determine the value of those assets, to ensure you will buy sufficient coverage to repair or replace them in the event that the worst happens.

Figure out how much coverage you need

The value of company assets then needs to be supplemented by other insurance coverage, depending on the company’s purpose and size. List all the functions and activities of your business, then assess the coverage you think is needed for each, based on its respective risk.

For example, if you own a property that clients visit in person, you’ll need liability coverage in the event they are injured on the premises.

Do you offer professional advice or products that, if found to be wanting, could cause damage to clients? Errors and omissions insurance should be part of your professional liability insurance policy.

Seek professional help, in part to research insurance companies

Even if you start the process yourself, the coverage assessment we describe above is best completed with help from an insurance professional.

One option is to seek out an independent agent or marketplace that specializes in business insurance and represents multiple insurers. The options here include the Coverwallet site and independent insurance agents near where you live.

Compare quotes

Insurance costs shouldn’t threaten your ability to make a profit. Shop around for quotes on the types of coverage you need.

An agent or marketplace site you’re working with will be able to provide quotes from the companies they represent. Consider supplementing those with quotes from companies you reach out to yourself — including some of those on our list, especially if your needs match the specialties for which we recommend each.

With the advent of online quotes from many companies, the process can be relatively easy. Just be sure you’re comparing apples to apples. The policies you compare online should have the same, or similar, exclusions, deductibles, and coverage limits.

Don’t consider pricing alone, however. Once you’ve gathered your business insurance quotes, research the companies that issued them. Check reviews of them from other sources, including checking for the insurers’ A.M. Best financial ratings.

These independent ratings, available online, rate insurers on their financial strength, which is a good indicator of their likelihood of remaining in business long enough to cover a claim for you. A rating of A or better provides strong reassurance of financial stability.

Look for policy bundling discounts

If the company you now use for other insurance, such as on your home or apartment contents, also writes commercial policies, include them in your research.

Many insurance companies offer discounted prices when you purchase multiple policies from them. In addition to the financial advantages of ganging up policies in this way, bundling coverage can reduce the time and hassle required to pay premiums, contact customer service, or make claims.

Review your business insurance regularly

With any insurance policy, it’s tempting to simply renew with the same carrier and at the same levels, year after year. But regular reviews – preferably when renewing the policy every year –may help you save money.

Reviewing your business insurance coverage gives you a chance to assess how you’ve used your coverage in the past. Did you meet the deductible last year? If not, you may want to consider paying more for a lower deductible or broader coverage limits.

Reviewing your coverage also gives you a chance to assess whether you need additional coverage. Your business may have grown a lot since you last considered your insurance needs. The basic coverage you bought a few years ago may no longer provide enough property coverage.

And it works both ways: You may be able to drop coverage limits or increase deductibles, saving money on premiums.

Along with annual reviews, try to re-evaluate your business’s level and types of coverage whenever business needs or circumstances change.