Business Insurance Cost Calculator
Estimate what business insurance will cost per year across every coverage line a small business actually buys — general liability, commercial property, workers' compensation, professional liability, commercial auto, and cyber — with a per-line breakdown and a realistic quoting range.
About this calculator
This calculator rates each coverage line the way commercial carriers actually rate it, rather than applying one flat percentage to revenue. General liability is priced per $1,000 of revenue against a rated revenue base that gives size credits — the first $500,000 rates at full price, the next $1.5 million at 75%, and everything above $2 million at 55% — because a flat per-dollar rate would badly overstate cost for a larger business whose exposure doesn't scale linearly with revenue. Workers' compensation is priced per $100 of payroll, the genuine national rating basis for comp, and only applies once you have both employees and payroll, since most states exempt sole proprietors with no staff.
Professional liability and cyber liability both scale sub-linearly with revenue using a square-root relationship, reflecting that a business four times the size doesn't carry four times the professional-services or data-breach exposure. Four underwriting modifiers then apply on top: your liability limit choice, years in business (new ventures pay a surcharge for having no loss history to credit), prior claims (the steepest single lever — three or more claims can nearly double a premium), and state cost tier, since workers' comp rates are filed state by state and can differ threefold for an identical class. Because real carrier quotes for an identical risk routinely vary 2-3x depending on each carrier's appetite for your specific class, the calculator reports a quoting range built around the total rather than a single number that would imply false precision, and it separately shows what bundling general liability and property into a Business Owner's Policy would save versus buying them as standalone lines.
Financial Disclaimer
This calculator is for educational purposes only and does not constitute financial advice. Results are estimates based on the inputs provided. Consult a qualified financial advisor before making investment or financial planning decisions.
These are planning estimates built on national median rates for small businesses, not quotes. Actual premiums depend on your specific class code, detailed loss history, state filings, and individual carrier appetite. Workers' compensation rates in particular are set by state filings and can differ by 3x for the same class between states. Always obtain quotes from at least three licensed carriers or an independent broker before budgeting or binding coverage.
Inputs
Results
Estimated Annual Cost
$4,836.00
How to Use This Calculator
- Pick the industry class closest to your primary operations — it moves the estimate more than anything else on this page.
- Enter gross annual revenue and, if you have staff, total W-2 payroll. Workers' compensation is rated on payroll, not headcount.
- Enter the replacement value of your building, contents, inventory, and equipment. Leave it at 0 if you rent and own nothing worth insuring.
- Set your liability limit — $1M per occurrence / $2M aggregate is what most contracts and commercial leases require.
- Open the advanced inputs to set years in business, claims history, and state cost tier. Claims history is the steepest single lever.
- Read the per-line breakdown, not just the total: it tells you which coverage is driving your cost and where shopping will pay off.
- Take the range, not the midpoint, to your broker. Quotes for the same risk routinely vary 2-3x between carriers.
How the result changes across these scenarios
| Scenario | Estimated Annual Cost |
|---|---|
| Solo consultant, no staff | $1,865.71 |
| Restaurant, 20 staff | $22,931.41 |
| General contractor, 10 crew | $85,125.77 |
| Retail storefront | $9,379.10 |
What each input means
- Industry
- Your business class drives the rate more than any other input. Pick the closest match to your primary operations.
- Annual Revenue
- Gross annual revenue. General liability and cyber are rated on this.
- Number of Employees
- Full-time equivalents, excluding owners. Set to 0 if you have no staff — most states then exempt you from workers' comp.
- Annual Payroll
- Total annual W-2 payroll. Workers' compensation is rated per $100 of this.
- Property & Equipment Value
- Replacement value of the building (if you own it), plus contents, inventory, and equipment. Set to 0 if you have no insurable property.
- Liability Limit (per occurrence)
- $1M/$2M is the standard most contracts and landlords require. Doubling the limit adds roughly 20%, not 100%.
- Commercial Vehicles
- Vehicles titled to the business. Personal auto policies exclude business use, so this is not optional if you drive for work.
- Years in Business
- Established businesses earn experience credits. Under 3 years carries a surcharge.
- Claims in the Last 5 Years
- The steepest lever in commercial underwriting. Three claims can nearly double a premium.
- State Cost Tier
- Workers' comp rates are filed state by state and vary up to 3x for the same class. Liability follows the state's litigation climate.
What each result means
- Estimated Annual Cost
- All coverage lines combined, before any bundling discount.
- Likely Quote Range — Low
- Carriers with appetite for your class quote toward this end.
- Likely Quote Range — High
- Carriers without appetite quote toward this end, or decline.
- Professional Liability (E&O)
- Zero for classes that do not customarily carry E&O.
- GL + Property as a BOP
- Bundling those two lines into a Business Owner's Policy instead of buying them separately.
- Share of Revenue
- Most small businesses land between 0.5% and 3% of revenue. Well outside that range, re-check the inputs.
How this is calculated
Formula
Total = GL(revenue × class rate) + Property(value × class rate) + Comp(payroll ÷ 100 × class rate) + E&O + Auto + Cyber, each × limit × experience × claims × state modifiersWorked example, using the default values
- Classify the riskIndustry class → rate tableOffice / professional services = GL $2.40 per $1,000 revenue · Comp $0.30 per $100 payroll
- Rate general liability on revenueRated revenue base × rate per $1,000$500,000 ÷ 1,000 × $2.40 = $1,200 before modifiers
- Rate workers' compensation on payrollPayroll ÷ 100 × class rate$300,000 ÷ 100 × $0.30 = $837
- Apply underwriting modifiersLimit × experience × claims × state1.00 × 0.93 × 1.00 × 1.00 = 0.930× on liability lines
- Sum the coverage linesGL + Property + Comp + E&O + Auto + Cyber$1,116 + $930 + $837 + $837 + $1,116 = $4,836 per year
- Express as a quoting rangeEstimate × 0.70 to × 1.45$4,836 × 0.70 to 1.45 = $3,385 – $7,012
Engine last updated . Built by Paul Gunder, a software engineer, not a licensed financial, medical, or legal professional.
Frequently Asked Questions
Why does my industry class matter more than any other input?
Class code reflects each industry's actual historical loss experience, and that experience differs by an order of magnitude between, say, an office-based consultancy and a construction contractor doing identical revenue. Every rate table in this calculator — general liability, workers' comp, property, professional liability, auto, and cyber — is indexed by class first, which is why changing industry moves the estimate more than any other single input.
Why does the calculator show a range instead of one number?
Carrier appetite for a given class varies enormously — a carrier that actively wants your type of risk will quote toward the low end, while one with little appetite for it will quote high or decline entirely, and that spread is routinely 2-3x for an identical risk. Presenting a single number would imply a precision that doesn't actually exist in how this market prices coverage, which is why the estimate is framed as a budget range to take to a broker rather than a quote.
Why do general liability and cyber liability grow slower than revenue?
General liability uses a tiered rated-revenue base that gives real size credits above $500,000, since carriers recognize that exposure doesn't scale linearly with revenue at larger volumes. Cyber liability and professional liability both scale by the square root of revenue relative to a $500,000 reference point, reflecting that a business four times larger doesn't carry four times the data-breach or errors-and-omissions exposure — both are genuine patterns in how these lines are actually priced.
How much does a single prior claim actually raise my premium?
One claim in the last five years adds an 18% surcharge across every liability line in this calculator, two claims add 40%, and three or more nearly doubles the liability premium at a 75% surcharge — making claims history the single steepest lever in the whole calculation. This mirrors real underwriting: a small claim you could have absorbed yourself often costs more in higher future premiums over several renewal cycles than it paid out.
Is bundling general liability and property into a BOP always worth it?
A Business Owner's Policy bundling those two lines together typically saves 10-15% versus buying them as separate standalone policies, which is what the BOP Bundling Savings figure quantifies for your specific numbers. It's usually worth pursuing when a business needs both lines anyway, though eligibility for a BOP depends on class, size, and specific carrier underwriting guidelines that vary by insurer.
Related Calculators
The questions that sit next to this one — chosen by subject, including calculators filed under a different category.
Business License Fee Calculator
Calculate total required licenses and fees for your business.
Small BusinessStartup Cost Calculator
Calculate one-time and recurring startup costs.
Business InsuranceGeneral Liability Premium Calculator
Estimate general liability insurance premiums based on revenue, payroll, industry classification, and coverage limits.
Business InsuranceProfessional Liability (E&O) Calculator
Estimate errors and omissions insurance costs by profession, revenue, coverage limits, and claims history.
Business InsuranceBusiness Interruption Coverage Calculator
Calculate the appropriate business interruption insurance coverage based on revenue, profit margin, and expected recovery timeline.
More in Insurance.