General liability insurance is the most common type of business insurance, and for good reason. It protects your business from claims of bodily injury, property damage, and advertising injury caused to third parties. But how much should you actually expect to pay? The answer depends on several key factors.
Average General Liability Insurance Costs
For small businesses in Washington State, general liability insurance typically costs between $19.99 and $300 per month. Here's what different business types can expect:
Low-risk businesses ($19.99 - $50/month)
- Consultants and freelancers
- Home-based businesses
- Professional services
- IT and technology companies
- Retail stores
- Restaurants and cafes
- Salons and spas
- Cleaning services
- General contractors
- Electricians and plumbers
- Roofers
- Manufacturing
Factors That Affect Your Premium
Industry and Business Type
Your industry is the biggest factor in determining your premium. Insurance companies use historical claims data to set rates, so industries with more frequent or expensive claims pay more. A roofing contractor faces significantly more risk than an accountant, and premiums reflect that reality.
Annual Revenue
Higher revenue generally means higher premiums. More business activity creates more opportunities for claims. A cleaning company with $500,000 in annual revenue will pay more than one with $100,000, even if they do the same type of work.
Coverage Limits
Standard general liability policies offer $1 million per occurrence and $2 million aggregate limits. Increasing these limits costs more. Some contractors and commercial clients require higher limits like $2 million per occurrence, which can add 20-30% to your premium.
Location
Where you operate matters. Urban areas with higher property values and more pedestrian traffic tend to have higher claims costs. A Seattle-based contractor may pay slightly more than one based in a smaller Washington city.
Claims History
If you've filed claims in the past, expect higher premiums. Insurance companies view previous claims as indicators of future risk. Staying claims-free for several years can help reduce your rates.
Deductible Amount
Choosing a higher deductible lowers your premium but means you pay more out of pocket when claims occur. Many small businesses choose deductibles of $500 to $2,500 depending on their cash flow and risk tolerance.
Ways to Lower Your Costs
Bundle Your Policies
Purchasing multiple policies from the same insurer often qualifies you for a discount. A Business Owner's Policy (BOP) bundles general liability with property insurance and typically costs less than buying them separately.
Maintain a Clean Claims Record
The best way to keep premiums low is to avoid claims. Implement safety procedures, train employees properly, and address potential hazards before they cause problems.
Shop Around Annually
Insurance rates vary between companies, and your business changes over time. Getting quotes from multiple insurers ensures you're not overpaying.
Pay Annually
Many insurers offer discounts of 5-10% for paying your premium in full rather than monthly installments.
Start with Adequate Coverage
Don't underinsure to save money. If a claim exceeds your policy limits, you're personally responsible for the difference. Proper coverage is worth the investment.
Getting an Accurate Quote
The only way to know exactly what you'll pay is to get a quote based on your specific business. SmartInsured provides instant quotes for Washington businesses with coverage starting at $19.99/month. Our system considers your industry, revenue, location, and coverage needs to provide accurate pricing.
What General Liability Covers
Understanding what you're buying helps you appreciate the value:
- Bodily injury: Medical costs and legal fees if someone is injured at your business or by your operations
- Property damage: Repairs or replacement if you damage someone else's property
- Personal and advertising injury: Claims of libel, slander, or copyright infringement
- Legal defense costs: Attorney fees even if the claim is groundless
- Medical payments: Small medical bills paid without determining fault, up to policy limits
What It Doesn't Cover
General liability has important exclusions:
- Professional errors (need professional liability/E&O)
- Employee injuries (need workers' compensation)
- Your own property damage (need commercial property insurance)
- Auto accidents (need commercial auto insurance)
- Intentional acts
- Contractual liabilities you specifically assume
Ready to Get Covered?
Get your personalized business insurance quote in minutes. Same-day coverage available for most businesses.
Get Your Free Quote