Business Insurance in Ontario

Business insurance in Ontario isn’t required by one law, but the WSIB, professional regulators, landlords and clients can all require it. Here’s what applies to small businesses and sole proprietors across the province, and the local risks to check a policy for.

Written by

Beatriz Alban Cabaco

Content Researcher

Reviewed by

Sean Nolan

10 years in insurance

Last updated

October 15, 2026

Is business insurance mandatory in Ontario?

No Ontario law requires every business to carry business insurance. Some requirements do apply, though: many employers have to register with the WSIB, some regulated professions require professional liability insurance, and commercial leases and client contracts commonly require liability insurance. In practice, that’s where most Ontario businesses first need cover.

Who may require it	What they may ask for	Why
The WSIB	Registration and premiums for your workers	Most Ontario businesses with employees must register within 10 days of hiring their first worker. In construction, owners and independent operators generally need coverage too, with some exceptions. It’s a provincial program, not a private policy
Your professional regulator	Professional liability insurance	Some regulators require it of their members. For example, lawyers in private practice must carry coverage through LAWPRO. Check with your own regulator
Your landlord	Liability insurance, and often insurance on your contents and improvements	Commercial leases commonly require it, and often ask you to name the landlord as an additional insured
Clients and general contractors	A certificate of insurance and a minimum liability limit	Many contracts set both before work starts. See what a certificate of insurance is
Your municipality	Proof of insurance for some business licences	Some licences may ask for it, depending on the business and the city
The law, for vehicles	Auto insurance	Required for every vehicle on Ontario roads. It’s a separate policy, and not something Clearly Rate refers

Liability insurance in Ontario is the cover most often asked for, because it’s what landlords and clients rely on if something goes wrong on their property or in your work.

What business insurance do Ontario businesses usually need?

Your work, your premises and your contracts decide it. Most Ontario businesses start with general liability, then add the coverages their risks call for. Small business insurance in Ontario is usually a package of several of these, and commercial insurance is the umbrella term for all of them.

General liability

The cover Ontario landlords and clients most often ask to see first.

Protects against: Injury or property damage you cause to others
Commonly needed by: Most businesses that deal with the public or work on others' property

General liability insurance

Professional liability

Some Ontario regulators require it of their members.

Protects against: Claims that your advice or service cost a client money
Commonly needed by: Consultants, designers, IT and regulated professionals

Professional liability insurance

Commercial property

Check how it treats flood, sewer backup and storm damage.

Protects against: Damage to or loss of your equipment, stock and premises
Commonly needed by: Businesses with equipment, stock or a location

Commercial property insurance

Business interruption

Worth asking about if a storm or power failure would shut you down.

Protects against: Lost income when a covered event forces you to close
Commonly needed by: Businesses that depend on a location or equipment

Business interruption insurance

Cyber

Most Ontario businesses’ customer data is covered by federal privacy law.

Protects against: Costs after a data breach or cyberattack
Commonly needed by: Businesses that hold customer data or take payments online

Cyber insurance

Directors and officers

Protects the people who run the organization.

Protects against: Claims about how a company or nonprofit was managed
Commonly needed by: Incorporated businesses and nonprofits with a board

Directors and officers insurance

Building or renovating? Builders risk insurance covers the building and materials while the work is under way.

Business insurance by type of Ontario business

What an Ontario business needs depends a lot on what it does. These are common starting points, not rules.

Trades and construction

General liability and tools cover, plus WSIB coverage, which in construction generally applies to owners as well as workers.

Protects against: Damage to clients' property, injury on site and stolen tools
Commonly needed by: General contractors, renovators and every trade

Contractor insurance

Professionals and consultants

Professional liability, sometimes required by your regulator, and general liability if clients visit you.

Protects against: Claims that your advice or work cost a client money
Commonly needed by: Consultants, accountants, designers and other professionals

Shops, restaurants and cafés

General liability, property and business interruption, often set out in the lease.

Protects against: Customer injuries, fire, theft and lost income
Commonly needed by: Retail stores, restaurants, cafés and other storefronts

Home-based businesses

A home policy usually excludes or limits business use, so check yours before relying on it.

Protects against: Business equipment, stock and clients visiting your home
Commonly needed by: Freelancers, online sellers and anyone working from home

Online businesses

Cyber insurance and professional liability are common. Federal privacy law, PIPEDA, applies to most Ontario businesses’ customer data.

Protects against: Data breaches, cyberattacks and claims about your service
Commonly needed by: Businesses that sell online or hold customer data

Nonprofits and companies with a board

Directors and officers insurance, which volunteer board members often ask about.

Protects against: Claims against directors and officers about decisions they made
Commonly needed by: Nonprofits, charities and incorporated businesses with a board

What does a real claim look like for an Ontario business?

These examples are illustrative, not real claims. Whether a policy pays depends on its wording, the limits and the deductible.

A customer slips on an icy entrance

On a January morning, a customer slips on ice at a shop’s front door and breaks a wrist. In Ontario, a business that occupies premises owes visitors reasonable care to keep them safe, so the customer claims against the shop. General liability can respond to the claim and the legal costs.

A storm backs up the sewer

A heavy summer storm overwhelms the city sewers and water backs up into a basement storeroom, ruining stock. Commercial property insurance may respond, but only if sewer backup cover was added to the policy. Without it, the loss is commonly excluded.

A consultant's error surfaces a year later

More than a year after a project ends, a client discovers that a consultant’s calculation was wrong and claims for the cost of fixing it. A claims-made professional liability policy can respond if it’s in force when the claim is made.

An ice storm cuts the power for days

Freezing rain brings down power lines and a café can’t open for four days. Business interruption cover may help with lost income, but many policies only pay when your own property is damaged. A power failure away from your premises is commonly covered only through an add-on.

Ontario risks to check your policy for

Ontario’s weather can damage premises and keep a business closed for days. The May 2022 derecho, a line of severe windstorms from Sarnia to Ottawa and on into Quebec, left more than a million homes and businesses in Ontario and Quebec without power. Before you buy, ask how a policy handles each of these:

Risk	Where it shows up	What to ask
Flooding	Rivers in the spring melt, and low-lying areas	Is overland flood covered, optional or excluded?
Sewer backup	Basements, especially in cities after heavy storms	Is sewer backup an add-on, and what’s its limit?
Ice storms and freezing rain	Across much of southern and eastern Ontario	Does business interruption cover a power failure off your premises?
Windstorms	Province-wide, as the 2022 derecho showed	Is there a separate deductible for wind and hail?
Snow and ice at your entrance	Every winter	Who clears it: you, your landlord or a contractor, and is that in writing?

Insurers price each address on its own, so flood exposure and local claims history can change what the same cover costs from one part of the province to another. The commercial property and business interruption pages explain those coverages in more detail.

Ontario laws behind common business claims

Two Ontario statutes sit behind many of the claims small businesses face. This is general information, not legal advice. A lawyer can tell you how they apply to you.

The Occupiers' Liability Act

Anyone who occupies premises, whether they own or rent them, owes people who come onto the premises a duty to take reasonable care that they’re reasonably safe. It’s the legal basis of slip-and-fall claims against Ontario businesses, and one reason landlords ask tenants to carry liability insurance. Read the Act.

The Limitations Act, 2002

In most cases, a claim can be started up to two years after it’s discovered, which may be long after the work was done. That’s why a claims-made professional liability policy matters: it responds to claims made while the policy is in force, not when the work happened. Read the Act.

Who regulates insurance in Ontario?

The Financial Services Regulatory Authority of Ontario (FSRA) licenses insurance companies and insurance agents in Ontario and oversees how they treat customers. Insurance brokers are licensed separately by the Registered Insurance Brokers of Ontario (RIBO). You can check that an agent or broker is licensed on FSRA’s or RIBO’s website before you buy.

If you have a complaint about an insurer, the usual route is:

The insurer

Raise it with the insurer first, then its complaints or ombuds office, and ask for its final position in writing.

The General Insurance OmbudService

If you’re still not satisfied, the GIO reviews disputes with its member insurers for free.

FSRA

FSRA can look at whether an insurer or agent broke the rules it enforces.

Clearly Rate isn’t an insurer or a broker. We refer you to licensed insurers, as our licensing page explains.

How much does business insurance cost in Ontario?

The price depends on your business, and insurers commonly look at:

Your type of business and the work you do
Revenue and payroll, and how many people you employ
Where in Ontario you are, including the property’s exposure to flooding and crime
The value of your building, equipment and stock
The limits your lease and contracts require
The deductible you choose
Years in business and your claims history

WSIB premiums are a separate cost, set by the WSIB rather than a private insurer.

To keep the cost down, describe your work accurately, look after the premises (clear snow and ice, and ask about a backwater valve or sump pump if your basement is at risk), choose a deductible you could actually pay, and review your cover each year. Websites quote all sorts of figures, but none of them can tell you what your business would pay. A quote for your own business is the only reliable number. Our guide to how much business insurance costs explains how insurers work it out, including the sales tax Ontario adds to premiums.

Business insurance across Ontario

Clearly Rate refers businesses anywhere in Ontario, from the Greater Toronto Area, Ottawa and Hamilton to the Niagara region, southwestern Ontario and the north. The coverages are the same everywhere in the province, but the risks aren’t: a storefront in a flood-prone part of a city, a workshop in a rural area far from a fire hall and an office in a downtown tower are each rated on their own address.

Get ready: what an insurer will ask

Having these answers ready makes quotes faster and more accurate:

What your business does, and roughly what share of your work is in each activity
Your annual revenue and payroll
How many employees you have, and whether you’re registered with the WSIB
Your address, and whether you own or rent the premises
The value of your building, equipment and stock
Any limits or certificates your lease or contracts require
Your claims history

Ontario business insurance FAQs

Is business insurance mandatory in Ontario?

Not as a rule. No Ontario law requires every business to carry business insurance. But many employers have to register with the WSIB, some regulated professions require professional liability insurance, and commercial leases and client contracts commonly require liability insurance before you can sign or start work.

Is WSIB the same as business insurance?

No. The WSIB is Ontario’s workers’ compensation program. It covers your own workers if they’re hurt or become ill on the job, and it’s run by the province, not sold by private insurers. Business insurance, such as general liability, covers claims from other people, like a customer or a client, and usually excludes injuries to your own workers.

Do sole proprietors in Ontario need business insurance?

No law requires it in most cases, but working alone doesn’t limit what you could owe if a client or customer makes a claim. As a sole proprietor, your business and personal assets aren’t separate. Clients and landlords may also ask for proof of insurance. If you work in construction, the WSIB generally requires coverage for owners too, with some exceptions.

Does my home insurance cover my home-based business in Ontario?

Usually not fully. Home insurance policies commonly exclude or limit business activity, business equipment and clients visiting your home. Check your policy and ask your home insurer what it covers before relying on it. Some insurers offer a home business add-on, and others suggest a separate business policy.

What does liability insurance cover in Ontario?

Commercial general liability usually covers claims that your business injured someone or damaged their property, such as a customer slipping in your store, including legal costs. Professional liability covers claims that your advice or service cost a client money. Neither usually covers injuries to your own workers, which fall under the WSIB. See general liability insurance.

How much liability coverage do Ontario businesses usually carry?

Start with your lease and your contracts, since landlords and clients often set a minimum limit you have to meet. Some regulators also set limits for their members. Beyond that, the limit is a choice to discuss with the insurer, based on your work and the size of the claims you could face.

Who regulates business insurance in Ontario?

The Financial Services Regulatory Authority of Ontario (FSRA) licenses insurance companies and agents in Ontario and oversees how they treat customers. Insurance brokers are licensed by the Registered Insurance Brokers of Ontario (RIBO). You can check a licence on FSRA’s and RIBO’s websites.

Ready to compare?

Tell us about your business and we'll refer you to licensed insurers.

Get your quote