How much does a business owner’s policy cost?

A BOP bundles general liability and commercial property insurance at a discount. Your level of risk, the value of your business property, and your policy limits will affect your premium cost.

BOP average costs for Insureon customers

The average annual cost of a business owner’s policy, regardless of policy limits, is $1,191 (less than $100 per month), with a median price of $636 ($53 per month). Most Insureon small business customers (almost 60 percent) pay less than $800 per year, and 11 percent paid less than $400 per year for a business owner’s policy.

These figures were sourced from an analysis of policies issued to Insureon customers.

How much do small businesses pay for a business owner’s policy with Insureon?

Industry risks impact BOP costs

For the general liability insurance portion of a BOP, industry has a huge impact on policy costs. Generally, high-risk industries pay higher premiums, while low-risk industries enjoy lower rates.

For example, a busy restaurant is exposed to more risk of customer injury than an IT consultant working remotely from a home office. Wholesalers and manufacturers also have high coverage costs because these industries often have valuable equipment or inventory, as well as increased third-party liability.

Median business owner's policy premium for Insureon customers by industry

To see insurance costs for businesses in your industry, visit our industry-specific cost analyses:

Property value impacts BOP costs

For the commercial property insurance portion of a BOP, the cost of insurance depends on the value of your business property, its location, and how you choose to protect it.

Business personal property (BPP) value

To protect your property, the first step is knowing what it’s worth. The accurate value for your business personal property will help you determine appropriate limits to make sure your insurance can cover the cost of replacing or repairing stolen, lost, or damaged items.

Location and age

The value of your building and subsequent insurance costs vary dramatically depending on where your business is located. For example, a small retail shop in rural Pennsylvania would cost much less to insure than a similar retail shop in urban California. Old buildings may also incur higher insurance rates as they are more susceptible to damage.

Replacement value versus actual cash value

The cost of a BOP varies depending on how you choose to insure your business personal property. You can insure it for its replacement value (cost when new), or save money by insuring it for its actual cash value (depreciated value).

How coverage limits affect insurance costs

If you want car insurance that pays for a wide range of damage, you have to pay more for it. The same rule applies to business insurance: If you want a policy with higher coverage limits, expect to pay more than you would for basic coverage.

The most popular business owner’s policy among Insureon customers is the $1 million / $2 million policy. This includes:

$1 million occurrence limit. While the policy is active, the insurer will pay up to $1 million to cover any single claim.

$2 million aggregate limit. During the lifetime of a policy (usually one year), the insurer will pay up to $2 million to cover claims.

Which business owner’s policy limits do small businesses choose?

The majority of Insureon customers (88 percent) chose a BOP with $1 million / $2 million limits. Ten percent of our customers chose a policy with $2 million / $4 million limits.

What small businesses pay for different BOP limits

The average cost of a $1 million / $2 million BOP policy is $1,217 per year, and the median is $638. A BOP with $2 million / $4 million limits has an average cost of $1,288 per year, and a median cost of $713.

Breakdown of costs for different BOP limits

Tips for finding business owner’s policy cost savings

Pay your entire premium upfront

Your business owner’s policy premium can typically be paid in monthly or annual installments. It might be tempting to go with a smaller monthly payment, but consider paying the full premium. Businesses can usually save money this way because many insurers offer discounts for annual premiums.

Proactively manage your risks

If your small business has no claims history, expect to pay lower insurance rates. An effective way to do this is to create a comprehensive risk management plan. For example, you might: