The Most Common Business Insurance Claims

Fire: $35,000Your company more than likely has business insurance to survive certain unexpected—but possible—challenges. Without the right insurance, a theft or fire can cause devastating losses. A personal injury lawsuit can leave you struggling just to pay the legal fees and yet many small business owners don’t take the time to evaluate their needs and get appropriate coverage. We often think of commercial insurance claims as coming from disastrous, unusual events, however small business insurance claims are a common part of doing business. But which claims are the most common? And what insurance coverages can help protect your small business? If you have any questions, contact our office at 413.475.7283 or Complete our online quote form today!

Burglary and theft. Burglary and theft claims include internal theft by employees as well as break-ins. In fact, 42% of inventory loss in U.S. stores is caused by employee theft.
Water-related damage. Damage from water to businesses can come from snow, flooding, freezing temperatures and burst pipes.
Wind and hail damage. When strong winds and hail damage commercial property, it can be detrimental for not just the business but the property owner as well.
Fire damage. According to the Insurance Information Institute, a structure fire occurs every 64 seconds. In 2018, structure fires not related to wildfire caused $11.1 billion in property damage.
Customer slips and falls. Slips and falls are a common cause of injuries sustained by customers of small businesses.

In addition to the most frequent claims, these claims were determined to be the costliest – listed in descending order based on severity. The dollar amounts reflect the average claim size.

Reputational harm: $50,000

Vehicular accident: $45,000

Product liability: $35,000

Customer injury or damage: $30,000

Wind and hail damage: $26,000

Customer slips and falls: $20,000

Water and freezing damage: $17,000

Struck by an object: $10,000

Burglary and theft: $8,000

Here are the key takeaways regarding business claims and their severity:

About 40% of small business owners will sustain a loss within the next 10 years.
Claims vary in frequency and severity. Burglary and theft claims have a high frequency and low severity. The reverse is true for reputational damage claims.
Claims occur more frequently than many business owners realize.
Many claims can be prevented through proper risk management.

Encharter Insurance offers coverage for businesses of all sizes across all industries. Contact one of our agents at https://encharter.com/business-insurance/ or call us at (413) 475-7283 today to discuss your business insurance needs and customize a policy that’s right for you and your business.