The Best Business Insurance For Self-Employed Careers

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Table Of Contents

If your career involves having your own business, business insurance is essential for protecting yourself and your company against unexpected loss. As the labor force changes, and more people are independent contractors, consultants and freelancers, insurance for small businesses must change with the trend. Each business has its own unique requirements, and with so many insurance providers out there, it can be difficult to know which to turn to in order to get the most bang for your buck. We put together this guide to the best business insurance providers to help you narrow down your options, so you can find the right policy for your small business.

We compared 22 of the best-known small business insurance providers based on their coverage, customer service and financial strength. We didn’t dig too much into price because this can vary significantly depending on the size of your company and the types of coverage you need. We did take into account customers’ general opinions on the affordability of the policies, though. In the interest of keeping our recommendations accessible to everyone, we only focused on large regional and national insurance providers.

We ended up with three companies we felt comfortable recommending. Each of them has excellent financial strength ratings from A.M. Best, Moody’s and S&P. They also scored above average in J.D. Power’s most recent customer satisfaction study. Farmers Insurance was our favorite because of its comprehensive policies, affordable rates and outstanding customer service. We recommend getting a quote from it, but we also suggest you check out our other finalists to see if they can offer you a better deal.

The 3 Best Business Insurance Companies For The Self Employed

Our top three business insurance companies are listed below. Click on the links to learn what we had to say about each of them and to get a quote from each company.

The Other 19 Business Insurance Companies We Considered

These are the other business insurance providers we reviewed. Ultimately, we didn’t choose them because they fell short of our finalists in terms of financial strength, coverage options or customer service. But if you don’t find anything you like with one of our top picks, you may have better luck with one of these.

  • AIG
  • American Family Insurance
  • Auto-Owners Insurance
  • CNA
  • Erie Insurance
  • Farm Family
  • Foremost Insurance
  • Hanover Insurance Group
  • Hiscox
  • Liberty Mutual
  • Nationwide
  • Progressive
  • Shelter Insurance
  • State Farm
  • The Hartford
  • Travelers
  • USAA
  • Zurich North America

How We Chose the Best Business Insurance Companies

We evaluated each business insurer based on its financial strength ratings, policy offerings and customer satisfaction ratings.

Financial Strength

Financial strength is a measure of how likely it is that the company will be able to pay out any claims it owes you. A low score suggests a company that isn’t very stable and may go under within the next couple of years. We made sure each of the companies we chose had at least an “A” rating from A.M. Best and a correspondingly high rating from either Moody’s or S&P. These are companies with a long history of insuring businesses, and they’re going to be around for a long time to come.

Policy Offerings

Then, we looked at each company’s policy offerings. Most companies offer, at a minimum, general liability, professional liability, product liability and property insurance. Many provide commercial auto and workers compensation coverage as well. Depending on what business you’re in, you may also want to look into additional options, like cyber-crime and loss of income coverage. All of our finalists do a good job in this category, but Chubb stands out the most. It has a number of unique coverages, like global casualty and environmental products, that you won’t find with the other companies on this list.

Customer Satisfaction

J.D. Power regularly conducts customer satisfaction studies on business insurance providers. We looked at the most recent report and compared each company’s ratings. The survey provides data on policy offerings, pricing, billing, company interaction and claims handling. Our finalists — Farmers, Allstate and Chubb — were the three highest-ranked companies in the survey, each scoring a four or a five. Farmers was the overall winner with near-perfect scores across the board.

A Note on Price

The cost of your business insurance policy will vary depending on which coverages you choose and the size of your company. While it’s common to look for the cheapest policy, this isn’t always the smartest choice. Sometimes, a low price requires you to sacrifice something in customer service, and you won’t appreciate that when the time comes to file a claim. Instead, get quotes from multiple companies and look for the one that offers you the best protection for the most reasonable price.

Full Reviews of the Best Business Insurance Companies

Farmers Insurance - Best Overall

Farmers was the only company to earn a five-star rating in J.D. Power’s latest review. Customers have reported that most of their interactions with the company have been positive and its claims handling is excellent. Policies are comprehensive and include property, liability, crime, auto, and workers compensation coverage. Farmers will help you build a custom policy that protects your business against all risks, but unfortunately, this personalization means you cannot get a quote online.

What to Expect

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Farmers offers business liability and property protection — the two most popular types of business insurance — as well as several other coverages. Its crime insurance is a broad protection covering theft, forgery and cyber liability while business auto insurance covers any company vehicles. Many states also require businesses to carry workers compensation insurance in case an employee gets hurt on the job, and Farmers can help with this as well. Life insurance is another option available to interested companies, and if you need some other coverage that doesn’t fall under one of these other categories, you can always add on an umbrella policy.

Those familiar with business insurance can start choosing their coverages right away, but if you’re new to the space, you may want to check out one of Farmers’ handy cheat sheets. They give suggestions on what types of coverages you may want to consider for a variety of industries, including auto service and repair, hospitality and restaurants. You can always reach out to a Farmers agent directly for some advice if you’re confused. You’ll have to call them anyway when you’re ready to get a quote.

In the unfortunate event that you need to file a claim, you can do so online or over the phone. While every insurance company claims to work with you until you reach a satisfactory solution, Farmers actually delivers, according to their customers. Most are pleased with the timeliness and fairness of the payouts and the interactions they’ve had with company representatives. And in the midst of a stressful situation like filing an insurance claim, excellent customer service cannot be understated.

Allstate - Best For Affordable Policies

Allstate scored the highest in the J.D. Power review when it came to pricing. The company consistently offers some of the most affordable rates for business insurance policies, and the coverage isn’t bad either. Choose from property, liability, workers compensation and business auto coverage. You can build a custom policy and purchase it all online. If Allstate has one downside, it’s the mixed reviews it’s received on its claims handling. That isn’t a guarantee that you’ll have an issue, but it is something to bear in mind when you’re comparing quotes.

What to Expect

Allstate’s business property and liability coverage are broad categories that cover theft, data compromise, personal property and even spoiled food in your company fridge. Workers compensation and business auto insurance are also available. You can manually choose how much of each kind of coverage you’d like or go with one of the company’s suggested packages based on your industry. There are options for everything from locksmiths and bakeries to automotive parts dealers and real estate companies.

You can get a quote by talking to an agent at one of the company’s branch locations or over the phone. There’s also an online quote tool if you feel confident enough to select your coverages and policy limits on you own. You just fill out some basic information about your company, property and employees and you’ll be presented with a quote. Once you’ve reviewed all the information and chosen the policy you want, you can pay for it right online without needing to speak to a representative.

If you need to file a claim, you can do so online, over the phone or through the company’s mobile app. An agent will be in touch with you to evaluate the damage and get you your money. The company promises a hassle-free experience, but according to the J.D. Power survey, they don’t always deliver. Allstate received just average ratings for company interaction and claims handling. This isn’t a guarantee of problems — and many companies scored even worse — but if you’re looking for the simplest possible claims process, you may want to think about paying a little more to go with a company like Farmers.

Chubb - Best For Customizable Policies

Chubb is the only one of our finalists to serve both small businesses and enterprises. As such, it’s a good fit for rapidly growing companies and those that need more than what a traditional small business policy can offer. These include global casualty, product recall and specialty catastrophe products. Wading through all of these different options can be confusing, but an agent can help walk you through your choices when you call for a quote.

What to expect

You can review Chubb’s long list of coverages individually or check out one of the many industry-specific packages to view suggested policies. There are options for many common industries, like manufacturing, hospitality, entertainment and food. Each policy covers basic property and casualty coverage to protect you against natural disasters, equipment breakdown or injured workers. They also cover all manner of liability, including crime, cyber crime, employment practices and errors & omissions liability.

These will form the basis of your policy, to which you can add things like business auto coverage and more unique protections like product recall coverage for businesses manufacturing goods for sale. Larger businesses that are considering going multinational may want to check out Chubb’s global solutions. And of course, you can purchase umbrella coverage if you need additional protection above what your basic policy provides.

Customers have reported largely positive interactions with the company, but according to the J.D. Power survey, they could stand to improve their claims handling. Chubb earned a below-average rating in this category, with customers expressing dissatisfaction with the company’s procedures and the fairness of settlements. Ideally, you’ll never have to file a claim and this won’t be an issue for you, but it is something you should take under consideration when comparing quotes. If you do need to file a claim, you can do so online, over the phone or by contacting your local Chubb agent.

Frequently Asked Questions

Business insurance can be confusing, especially if you’ve never had to purchase it before. We’ve answered some of the most common questions new business owners have below to help you figure out how business insurance works, what types of coverages you need and how to score the best deal possible.

Does my company need to have business insurance?

That depends on the kind of business you have, but most likely yes. The exact requirements vary by state, and you can learn more about your state’s specific requirements by visiting its Department of Insurance website. In general, though, most businesses are required to carry the following types of insurance coverages.

Unemployment Insurance

If you have employees that work for you, you must have unemployment insurance. This covers the cost of those employees’ unemployment wages if for some reason you let them go down the road.

Workers Compensation Insurance

This coverage is also required of any business that has employees. It pays for on-the-job accidents that result in employee injury.

Business Auto Insurance

You must have this type of coverage if your company has its own vehicles. These vehicles are not covered under your personal auto insurance policy.

Professional Liability Insurance

Certain professions, including lawyers and doctors, are required to carry professional liability or malpractice insurance to protect you in case you are sued by a client and found guilty of negligent or reckless behavior.

What kinds of insurance does my business need?

Obviously, you must purchase all coverages required by law in your state. Beyond that, it’s up to you to decide what kinds of protections you need. Here are a few common insurance types you may want to consider.

Property Insurance

This works much like a homeowners policy does for your house. It pays for any damages to your place of business, such as those caused by fire or storms. If you have a loan on the building, your lender may require you to purchase some type of property insurance in order to be approved.

General Liability Insurance

This is a broad coverage that protects you from all types of damages that you could be held liable for. These include bodily injury, property damage, medical payments, and personal or advertising injury. It also covers the cost of hiring an attorney to defend you if you are sued for one of these reasons.

Product Liability Insurance

This is a good type of coverage to have if your business manufactures goods to sell to the public. If a customer suffers an injury or death due to some fault in your product and you are found liable, this type of policy will cover the costs.

Business Interruption Insurance

This coverage protects you if something catastrophic should happen that prevents you from running your business. It will pay you for your lost income to help keep you afloat until you can get your business back up and running again.

Cyber Crime Insurance

Cyber crime insurance protects you in the event of a data breach. In these situations, you can be held liable for failing to protect your customers’ personal information, and without insurance protection, you could end up paying settlements out of your own pocket.

Employment Practices Liability Insurance

This insurance protects you if an employee attempts to sue you for the way that you conduct your business. For example, if they argue that you’re discriminating amongst your employees, this type of coverage would apply.

How do I get the best deal on business insurance?

Insurance policies are unique to your business, so there’s no single best company for everyone. Fortunately, there are a few simple steps you can follow to ensure you get the best deal for your business.

Determine how much coverage you need

The first step to figuring out how much business insurance you need is to find out how much you’re required to carry by law. Check with your state’s Department of Insurance to see their requirements and set this as your minimum. Then, you need to figure out how much more protection you need to feel safe. There is no magic number. It all depends on how many employees you have, how much money you make and the risks you’re exposed to in your line of work. If you’re not sure how much coverage you need, you can always speak with an insurance provider that knows your industry.

Get quotes from multiple companies

It’s a no-brainer, but you should compare quotes from multiple companies before you purchase a policy. Don’t just look at price, either. Compare how much coverage you’re getting for the price and choose the one that offers the best overall value. Make sure that any company you choose has solid financial strength ratings, so that you don’t get stuck paying for a policy you’ll never be able to use. You may want to check out customer reviews as well to see what the company’s customer service and claims handling is like.

Shop around regularly

Most insurance companies would like you to believe that you’ll be rewarded for being loyal, but in fact, the opposite can be true. Many insurance companies employ a practice called price optimization, which determines your premiums in part based on how likely the company thinks you are to shop around. If they believe you’ll stay loyal no matter what, you’ll get charged higher rates and be none the wiser. Over a dozen states have banned the practice, but in most, it still continues. You can combat this practice by regularly getting quotes from other business insurance companies to ensure you have the best possible policy.