Best General Liability Insurance for Sole Proprietors in 2024

Sole proprietors need affordable, comprehensive and reliable general liability insurance to protect their businesses from potential risks and liabilities. We evaluated the best sole proprietor business insurance options based on cost, coverage and customer satisfaction—narrowing our list down to the top four providers.

• biBERK: Best Overall General Liability Insurance for Sole Proprietors
• Thimble: Cheapest General Liability Insurance for Sole Proprietors
• The Hartford: Best for Customer Satisfaction
• Hiscox: Best for Cost Savings on Supplementary Coverage to General Liability

To find the best sole proprietor business insurance options, MoneyGeek examined 1,229 quotes from various providers, analyzing each provider’s affordability, customer satisfaction, financial stability and online quote process.

MoneyGeek used a sole proprietorship with the following characteristics to gather general liability insurance quotes:

• Five years in business in the software development industry
• No employees and no payroll costs
• $500,000 in annual revenue

It costs an average of $342 a year for a general liability policy with a $2 million aggregate limit, $1 million occurrence limit and $0 deductible. This can change depending on several factors. Factors that impact the cost of business insurance for sole proprietors include:

• Industry risks: The kind of industry your business is in can affect costs, as the associated risks will determine your likelihood of making a claim. The riskier the industry, the higher the insurance premiums may be.
• Location: The risks specific to where your business is located can result in more expensive premiums. For instance, if your area is more prone to wildfires or crime, you might need to pay more.
• Previous claims: If you’ve made a claim before, your insurance premiums may increase.
• Coverage: Higher or lower limits can impact your costs. The higher your liability limits, the more you can expect to pay.

It's important to note that if you’re a sole proprietor with no employees, payroll will not impact your insurance premiums. Business owners are not considered an employee in a sole proprietorship. However, if you do have employees, your general liability insurance premiums may be calculated differently.

General liability insurance for sole proprietors provides basic coverage against common risks — but it may not protect you against all the risks your business may be exposed to.

Here are a few coverage options you could consider, depending on your industry:

• Workers' compensation insurance: This is legally required in most states and covers any work-related injuries or illnesses your employees face. For instance, medical bills, lost wages and rehabilitation costs can be covered by workers’ compensation. Requirements can vary by state.
• Commercial auto insurance: If your business owns or uses any vehicles, commercial auto insurance can provide coverage in the event of an accident, damage or injury.
• Professional liability insurance: This protects your business against claims of errors or mistakes in the services provided, paying for legal fees, settlements and judgments related to professional negligence.
• Commercial property insurance: This type of insurance pays for repairs or replacement of damaged property that the business uses from damage or loss due to fire, theft or other covered perils.
• Business income insurance: This type of coverage provides compensation for lost income if your business is unable to operate due to a covered event, such as a fire or natural disaster.

Finding the right general liability insurance provider involves careful research and analysis of your business needs. Get a deeper understanding of the best general liability insurance for sole proprietors through our frequently asked questions.