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Business Insurance

Starting or running a small business and curious about insurance? We’re here to help.

What is business insurance?

Business insurance, sometimes known as commercial insurance or business liability insurance, is a type of policy that provides financial protection for business owners and their employees. It helps to protect businesses from potential risks, such as property damage, lawsuits, legal expenses, cyber risks, business interruption, and other types of losses and risks. It’s a broad term that actually encompasses various insurance policies. 

Do I need business insurance?

Business insurance is a must-have for business owners, regardless of size or industry. Whether you are a small business owner with just one employee or the head of a large corporation, business insurance can help protect your organization. Often your business is your livelihood or the livelihood of your employees. Ensuring its adequately protected makes good business sense.

What does business insurance cover?

Depending on the type of coverage your business gets, it can cover various situations, from third-party bodily injury to commercial property and professional liability. A licensed insurance broker can help you understand the specific types of coverage your business needs, for example, these are the most common business insurance policies:

Is Insurance Required to Run a Business?

While insurance is not legally required for business owners, it can offer essential protection in case of a claim or loss. Clients may also require insurance proof to award your business a contract. In particular within the construction industry. If you’re an entrepreneur or a small business owner, having small business insurance can protect your business and your livelihood from risk.

Similarly, investors, banks and prospective board members will want to ensure that you have the right coverage to protect their investment in your company.

Small Business

What is business interruption insurance?

This type of coverage protects businesses from financial loss caused by an interruption in work due to an accident or disaster. It compensates for lost revenue, unplanned expenses due to disruption, and other costs needed to get your business back on track. It’s not the most common commercial insurance policy for a small business compared to general liability insurance or commercial property insurance, which are likely more useful when starting out.

How much is business insurance?

The cost of business insurance can vary greatly depending on several factors, including the type and amount of coverage needed, the business’s size and industry, and its claims history. For business owners looking to find the best business insurance policy for their company, it is essential to understand what impacts the cost of business insurance so they can make an informed decision.

If you have a large company with business operations that are inherently risky, unfortunately, you can expect your insurance quote to be higher than that of small independent contractors.

Latest Guides and Blogs on Business Insurance

Insurance Carriers & Reviews

APOLLO Insurance
Intact Financial Corporation
Aviva Insurance Company of Canada
Economical Insurance
Travelers Insurance Company of Canada
Royal & Sun Alliance Insurance Company of Canada
Lloyd’s Of London
AIG Insurance Company of Canada
Markel Canada
Victor Insurance
Chubb Insurance Company of Canada
Liberty Mutual Canada

 

Business Insurance FAQs

How to Apply for Business Insurance?

Applying for insurance is a relatively simple process with a good insurance company. You can prepare for your application by getting together a reasonable estimate of your yearly revenue and a clear description of the kind of work your business does. In some cases, if you offer services in a licensed profession for example, a doctor or dentist, you may need to have proof of training and your license to practice. 

Is Business Insurance Tax Deductible?

According to the CRA, business insurance is a tax-deductible expense. That said, you should always chat with your tax accountant to confirm your specific situation.

Do I Need Business Insurance for a Sole Proprietorship?

Yes, just like any other business, you are exposed to the same risks. Arguably it’s even more important for sole proprietors as they don’t have limited liability.  For example, if a customer slips and falls on your premises, they may claim compensation for any damages and injuries. 

What is Third Party Property Damage?

It’s when you or your business causes damage to someone else’s property. For example, if you accidentally break your customer’s door while visiting them.

Are business insurance claims taxable income?

It depends on the kind of payout you receive for your claim. 
For example, if an insurance claim pays out more than the value of an asset minus depreciation, then you could be liable for taxes. 
Similarly, business interruption insurance can result in taxable income. 
In all cases, it’s best to seek the advice of a tax accountant.

What business insurance do I need for a limited company?

It depends on what your company does. As a basic rule of thumb, you will likely need to get commercial general liability, or CGL. This will cover you against any third-party bodily injury claims or property damage.
A professional liability insurance policy is likely the right choice for your business if you offer professional services and advice. 
A commercial property insurance policy is advisable if your business owns any substantial assets. 
As always, speak to a professional insurance advisor to understand the risks your business faces and how to protect against them. 

What type of insurance is a must have for a company?

CGL, or commercial general liability insurance is the most basic form of business insurance, it doesn’t cover everything but covers some of the more common scenarios. For example, a slip or trip on your premises or damages to third-party property.

How much does small business insurance cost?

Are you a small business in Canada wondering how much small business insurance will cost you? The truth is, it depends. Every business is unique and will have different insurance needs, making it difficult to provide an average cost. Factors like your type of industry, perils, insurance history, requirements, and many other considerations play a role in determining the cost of your insurance.

How do I choose a small business insurance broker?

How do I choose a small business insurance broker?

  1. Consider your needs, finances, and risks. Think about what kind of coverage you need and how much you can afford to spend.
  2. Research different providers. Look for reviews and compare coverage and pricing from the providers you’re considering.
  3. Contact the providers. Get quotes from the providers you’re considering and ask any questions you have.
  4. Partner with a broker. Get help from an experienced insurance broker who knows your business and can provide tailored solutions.
  5. Use an online insurance provider. Fill out an online form to get a quote and compare rates from the leading insurance companies.
  6. Customize your policy. Choose the policy that best fits your needs and get insured.
  7. Get peace of mind. An insurance broker will help you make sure your business is protected.

What should I do if my business has an insurance claim?

If your business has a liability claim, you should follow these steps:

  1. Notify your insurance broker or company immediately to begin the claim process.
  2. Collect all relevant information about the incident, including photos, descriptions, and contact information for any parties involved.
  3. Gather supporting documents such as contracts, warranties, and receipts to help prove your case.
  4. Contact an attorney to evaluate the merits of the claim and advise you on the best plan of action.
  5. File a formal claim with your insurance company, providing all of the relevant evidence and information.
  6. Monitor the insurance company’s investigation and provide any additional information as needed.
  7. Negotiate with the insurance company to reach a fair settlement.
  8. Follow through with any legal actions necessary to resolve the claim.

How much of a deductible should I have on my business insurance?

When it comes to your business insurance, you should consider how much of a deductible you want to have. A deductible is what you’ll be required to pay out of pocket when you file a claim. Generally, the higher your deductible, the lower your premium will be. However, you should weigh the costs and benefits of different deductible amounts to decide what’s best for your business.
For example, a $2,000,000 small business insurance policy with a $1,000 deductible will generally be more affordable than one with a $5,000 deductible. It’s important to keep in mind that the deductible amount you choose will affect the amount of coverage you get. If you opt for a higher deductible, you may be able to get lower premiums but you may have to pay more out of pocket when you file a claim.
It’s a good idea to speak to an insurance professional to get advice tailored to your business. They can help you understand your specific insurance needs and make sure that you are getting the best coverage for the right price.

Which insurers in Canada provide business insurance?

There are a number of insurers in Canada that offer business insurance for small and large businesses. ThinkInsure is a leading insurer for small business insurance in Ontario. Other major insurers in Canada that offer business insurance include APOLLO Insurance, Intact Insurance, Aviva Canada, Economical Insurance, and The Co-operators. These insurers provide liability coverage and other types of business insurance, such as property and casualty, auto, and professional liability or errors and omissions coverage.