How Much Does General Liability Insurance Cost?

Being a business owner gives you a lot of opportunities to interact with and help people. But even if you do everything you can to make your office inviting and keep your clients (and their materials) safe, sometimes accidents still happen — and that could lead to a general liability insurance claim. So, how much does general liability insurance cost?

Investing in a general liability policy ensures your business is covered for legal fees, medical expenses, settlement costs, replacements, and repairs, so you can have peace of mind knowing everything will be taken care of should someone file a claim. In this article, we go over average general liability insurance costs, explain factors that can affect prices, and share a few tips for keeping your premiums low.

Average Costs of General Liability Insurance

General liability (GL) claims are some of the most costly claims that people file against businesses. According to Insurance Journal, customer injury claims average around $30,000, and a claim for a slip and fall injury can cost $20,000 or more.

General liability insurance costs less than paying out of pocket for these types of GL claims, which customers may make against your business for:

• Damage to their personal property, such as if you crack their sink while working on a plumbing project in their home
• Bodily injuries, such as those resulting from slipping and falling on a loose rug in your office building
• Personal or reputational injury, such as libel or slander
• Advertising injury, including failure to follow through on a promise or a rival brand sues for slander

It’s hard to pin down a specific price for general liability insurance because it can vary quite a bit, depending on your general liability coverage needs and the details of your business. But it’s an important investment; every business carries some level of risk, and insurance helps protect you against the financial impact of a claim.

At Berxi, we’ve found that monthly business general liability insurance costs start at:

• $100 for contractors who work in clients’ homes or offices
• $350 for business owners with employees and office spaces

And according to most estimates, you can expect rates somewhere between $500 and $1,000 if you pay annually

Factors That Impact General Liability Insurance Costs

You may pay more or less for general liability insurance depending on the level of risk your business carries. More risk means higher potential costs for the insurance company per claim or policy period, which affects the price of your premiums.

Let’s look at the most common factors that insurance companies use to measure risk and how they impact your general liability insurance cost.

Coverage limits

The amount of coverage in your policy is known as limits of liability. It’s just what it sounds like: the highest amount your insurance company will pay — the amount it’s liable for — per claim or period. The more coverage your business needs, the more you’ll pay for premiums.

Business industry

The industry you work in can affect your level of risk. Higher risk means a higher likelihood of claims being filed, so you’ll pay more for premiums.

Business size

The more transactions you do, the more you will want to protect yourself. That means you will be asked for the size of your business, and that doesn’t just mean the size of the physical space you rent or own. It will also mean the annual amount you earn and the number of offices and employees you have.

Location

Operating in certain states or cities can mean paying more for your liability insurance policy. Insurance companies expect more legal disputes in states where a lot of claims get filed, so premiums will be higher. Policies may also cost more in cities with bigger populations because businesses in these areas typically have larger client bases.

The type of space where you do business can also affect business general liability insurance costs. For example:

• Offices pay more for general liability insurance because there are more risks of injury or property damage. Problems with sidewalks, parking lots, staircases, elevators, and even heating and cooling systems may all lead to general liability claims.
• Home offices can pose a risk of bodily injury if they’re cluttered with your unfiled papers, your pet’s toys, or your kids’ shoes. Uneven sidewalks, wet walkways, or aging staircases can also be hazards to your clients.
• Traveling to different locations as a contract-based business puts you at risk of damaging other people’s property, especially if you perform service or maintenance work in homes and offices.

Claims history

Having claims filed against your business can increase the cost of your general liability insurance. Insurance companies may use your claims history to predict how expensive it will likely be to cover future legal proceedings — and they charge accordingly for coverage.

How to Lower Your Small Business General Liability Costs

Fortunately, you have control over factors that could increase your risk for a claim, which means you can make changes that can lower your general liability insurance costs. No matter where you work or what kind of business you run, you may be able to reduce your premiums by:

• Buying directly from the insurer, which can save up to 15% in brokers’ fees.
• Buying only the limits of liability coverage you need. Some insurance policies start at $1 million per claim, which is a lot more than certain small businesses need. If you’re in an industry that typically gets claims under $500,000, don’t pay for more.
• Shopping around to compare prices and discount options from different insurance providers.
• Reviewing your coverage whenever something at your business changes to see whether it makes sense to lower your limits of liability or increase your deductible (if you have one).

Protect Your Business With General Liability Insurance From Berxi

You can save even more on general liability insurance by purchasing your policy directly from an insurance company. At Berxi, you could pay an average of 15% less compared to going through a broker, plus you enjoy the assurance of working with a company that’s part of Berkshire Hathaway Specialty Insurance and has financial strength ratings of A++ from AM Best and AA+ from Standard & Poor’s.

You also get a claims team that updates you throughout the claims process, responds to your concerns and questions promptly, and works closely with attorneys to help ensure a fair and reasonable outcome. You’ll never be without an advocate, and you can be sure that someone will always be there to help with the detail work.

Berxi will be rolling out general liability insurance state by state throughout 2025. Learn more and get a quote.

General Liability Insurance Cost FAQs

How much is a general liability policy annually?

On average, general liability insurance at Berxi starts at $100 for industries that don’t have office spaces, and $350 for those that do.

How much does general liability cost for a startup business?

Startup liability insurance costs vary depending on the size, location, and industry of your business. It is also based on annual revenue, so the fact that you’re just starting your business can help reduce your cost.

How much is a $1 million general liability policy?

The cost of Berxi policies will largely be based on your profession, gross income, and location, as well as what limits you choose. At Berxi, a $1 million aggregate policy starts at $100, but the average starting point is $350 per year.

How do insurance companies calculate general liability rates?

Insurance companies look at several factors to calculate your general liability premiums. These include your industry, business location, and claims history, all of which determine the likelihood of a claim being filed against you. The amount of coverage you need for your business also affects what you pay for general liability insurance.

 

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Last updated on Mar 27, 2025.
Originally published on Mar 19, 2025.

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The views expressed in this article are those of the author and do not necessarily reflect those of Berxi™ or Berkshire Hathaway Specialty Insurance Company. This article (subject to change without notice) is for informational purposes only, and does not constitute professional advice. Click here to read our full disclaimer