When it comes to the cost of insurance, the industry in which a company operates is a major factor. Businesses that are exposed to more risks, such as roofing contractors, will have higher premiums than those with lower risks, such as business consultants. Premiums can vary significantly between industries and insurers. The cost of general liability insurance also depends on the coverage limit chosen by the business owner.
The limit is the maximum amount that an insurance company will pay in the event of one or more claims. Generally, this limit is expressed per event and in an aggregated form. The per-occurrence limit is the maximum the insurance company will pay for a single claim, and the total is the maximum the insurer will pay for all claims during one year of the policy. The type of business a company conducts is the most important factor in determining the cost of general liability insurance. Companies with low exposure to risks, such as those that perform office work, will have the lowest premiums for general liability insurance.
Companies with moderate to high exposures, such as automotive services, cleaning services, food, hospitality, healthcare, retail, and manufacturers of non-hazardous products, will usually have premiums around the average premium. Companies that work in inherently hazardous or hazardous industries, such as construction and contracting and landscaping, will pay the highest premiums for general liability insurance. The amount of sales a company makes is also an important factor in determining the costs of general liability insurance. In general, the higher the incomes, the higher the premiums. The number of employees a company has can also affect general liability insurance premiums.
Since a company is insured for many of the actions that employees perform while working, increasing the number of employees will normally increase the company's premiums. For businesses that operate in physical locations, the square footage that the company occupies can be a factor in determining the cost of premiums. In general, the more square footage, the higher the premium. However, this increase may depend largely on the industry and on whether or not it leads to greater exposure to risk. The state a business is in can also affect general liability insurance premiums. Insurance is regulated separately by each state and is subject to its laws and economic context.
Since courts, juries, and legislatures have different views on legal liability in each state, businesses may be exposed to different levels of risk depending on where they are located. General liability insurance is offered by several commercial insurance providers and it's important to compare quotes to find one that best fits your business needs. Price shouldn't be your only consideration when looking for business insurance: take into account factors such as coverage limits and customer service when making your decision.
