Running a business comes with a laundry list of costs. One of them is business insurance. But just how much of the overall budget should be dedicated to a policy?
Whether you’re opening a new Brooklyn business and on the hunt for coverage, looking to replace your current business insurance policy, or researching business insurance costs in Brooklyn for a future endeavor, you’re in the right place.
Read on to learn the basics of business insurance, the average costs of some of the most popular types, and how you can save money without compromising coverage.
Do You Need Business Insurance?
Business insurance is financial protection for your business’ assets from lawsuits, property damage, vandalism, theft, employee injuries, and more. To ensure a business is fully protected, there are multiple types of insurance policies for business owners to choose from.
Can a business operate without insurance? Technically, yes. But this doesn’t mean an uninsured path is a wise approach to take as a business owner. Consider the following reasons why business insurance is a must if you’re considering skipping out on a policy.
Lawsuits are common…and expensive
Litigation, even if unwarranted, can erase your business from the map overnight. Over 100 million business lawsuits are filed in US state courts every year and the average employment lawsuit can cost a company upwards of $200,000. Without business insurance, you could be stuck footing the bill alone. Could your business recover?
Inadequate coverage can lead to missed opportunities
There are many business scenarios that could lead to a discussion on insurance. For example, if you work as a contractor of any sort, obtaining business insurance may be part of your contract with certain clients. If you rent office space, your landlord may require you to purchase a business insurance policy. And finally, some professional licenses require general liability insurance (e.g. accountants and real estate agents). Often missed is checking in with your insurance broker as your business grows. You want to make sure you are adequately covered. So, your insurance coverage should grow proportionally with your business. Make sure your broker is checking in with you at least yearly.
Coverage is often legally required
There are dozens of business insurance policies and riders to consider for your business. While you’re not required to purchase a policy for all types, your state may require you to have insurance to operate. For example, if your business address is in New York and you have employees (even contractors), you’re legally required to carry workers’ compensation and disability benefits insurance. If your business owns any vehicles, you’ll need auto insurance as well.
5 Factors that Affect Business Insurance Costs in Brooklyn
A reputable insurance broker will always put together a custom package for a business they’re working with. This means that business insurance policies are rarely identical in coverage or cost. There are several things that affect business insurance costs in Brooklyn, including the following:
1. Type of business
Certain industries carry more risks than others. For example, a construction company specializing in high-rise development can expect to pay more in business insurance premiums than a hairstylist.
2. Physical location
The address of your business matters when it comes to getting an insurance estimate. How close is the nearest police station? How quickly could a firetruck be on site? Local crime rates matter too. Take a look at these crime statistics for the Brooklyn area to see where your business’ neighborhood falls.
3. Management practices
How much training do your employees go through? Would your processes be described as secure or risky? As a business owner, you have more control over your premium costs than you may think. Thorough and proven management practices can help you lower your business insurance costs.
4. Value of business property
Are you a solo entrepreneur with a laptop and a few digital assets or does your office have a street named after it along with a parking garage and cafeteria? From your building, if applicable, to digital assets and office equipment, the value of your business property will have an undeniable impact on your business insurance premiums.
5. Past claims history
Finally, if you’ve made several business insurance claims in the past, you can bet on a higher policy quote than one for a company without a claim record.
Estimated Business Insurance Costs for Brooklyn by Type
Business insurance is always worth the investment. But just how much will a policy set you back? Here are the median costs of some of the most common business insurance policies.
- Workers Compensation Insurance median cost in Brooklyn is $80/month, based on information from Progressive Commercial, a carrier we work with.
- Business Owners Policy median cost in Brooklyn is $85/month, based on information from Progressive Commercial, a carrier we work with.
- General Liability Insurance median cost in Brooklyn is $57/month, based on information from Progressive Commercial, a carrier we work with.
- Professional Liability Insurance median cost in Brooklyn is $50/month, based on information from Progressive Commercial, a carrier we work with.
- Cyber Insurance median cost in the United States is $125/month, based on information from Business Insurance.
How to Save Money on Business Insurance
If business insurance costs in Brooklyn have left you sticker shocked, consider implementing any of the following money-saving tips.
If you’re purchasing more than one policy, ask about a bundling discount.
Raise your deductible
Opting for a higher deductible will result in lower premiums. Consider your overall risks before choosing this route though.
Reevaluate your coverage
As your business grows and evolves, you may find that your coverage needs change. Avoid paying for coverage you don’t need or being underinsured by routinely reevaluating your coverage needs.
Finally, remember that it’s not just about the cost of your policy. Opting for a cheaper policy could end up costing you more in the end. And choosing an overpriced policy doesn’t guarantee adequate coverage. Taking the time to find a policy with industry- and business-specific coverage at a fair price is always worth it in the end.
How Do I Get Business Insurance in Brooklyn?
When it comes to purchasing business insurance, working with a local broker is always the recommended route. For Brooklyn-based businesses, Lincoln Brokerage has been a trusted name in the insurance industry for over 100 years.
We know you have a lot on your plate as a business owner. That’s why we make it easy to reach us for a custom quote on business insurance policies. Leave your contact information here and one of our brokers will be in touch to learn more about your business and help you save on business insurance costs in Brooklyn.