Insurance for Small Business Owners in California

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Do You Need Small Business Insurance in California?

California really is golden. If California were its own country, it would be the world’s 5th largest economy. It is the largest economy in the US by far! With all of the potential opportunities, it is no surprise that small businesses can flourish in California. From Redwood National Park to Joshua Tree National Park and beyond, people flock to the state. Your small business is there to serve them. In fact, the industry of accommodation and food services is the most significant small business industry for employers in California. Healthcare, professional services, construction, retail, and manufacturing round out the top small business industries. 

  • There are over 4.1 million small businesses in California
  • 99.8% of businesses in California are considered small businesses
  • Over one million people are employed in the accommodations and food services small businesses of California

Put down your Mickey ears, your surfboard, or your hiking shoes, and consider this: 48.5% of private workforce employees in California are employed by small businesses. Small businesses are vitally important to California’s ongoing success in outpacing the US growth rate! Silicon Valley may bring in big technology dollars, but it is the grape growers keeping the wine industry alive. Beaches, Hollywood, redwoods, and Death Valley all bring opportunities for small business ownership. As California grows, it is essential to consider business insurance to help protect your small business. Some insurance coverages are required for all California businesses—we’ll tell you more here.

California Business Owner's Policy
California Workers’ Compensation

Required Business Insurance Coverage in California

California requires the following insurance coverage for small businesses:

  1. Commercial Auto Insurance.

    If your small business owns vehicles, California requires it to have commercial auto insurance coverage. California specifically requires a minimum amount of auto liability insurance coverage. The minimum coverage includes a liability limit of $15,000 per person, $30,000 per accident for bodily injury, and $5,000 for property damage.

  2. Workers’ Compensation Insurance.

    In California, whether you have one employee or 50, your small business must provide Workers’ Compensation coverage. Small business owners must purchase workers’ compensation insurance from a licensed insurance company like B2Z or through the State Compensation Insurance Fund. Your business must post a “notice to employees” poster in a conspicuous place. Workers’ compensation coverage in California typically provides relief for employees, including healthcare and legal costs related to your business. Employees agree not to sue your business over an accident or related illness in exchange.

Recommended Business Insurance Coverage in California

The following insurance coverage is recommended for California small businesses:

  1. Small Business Owner’s Insurance.

    Having a Business Owner’s Policy (BOP) in place typically provides coverage for a customer’s medical expenses resulting from accidents on site, advertising damage claims, and losses and damages related to property used for business purposes. This coverage type saves you money by bundling general liability insurance and property insurance into one convenient policy.

  2. General Liability Insurance.

    General Liability can be sought as a separate minimum coverage if a BOP isn't suitable for your California small business. In fact, if you lease space, your commercial property contract may include a General Liability Insurance requirement. Having General Liability Insurance helps ease the burden of property damage claims or customer injury and slander and libel lawsuits. 

  3. Professional Liability Insurance.

    Also called errors & omissions or e&o, Professional Liability Insurance covers work mistakes and errors, missed deadlines, incomplete work, and professional negligence lawsuits. Professional Liability coverage is ideal for California small businesses that provide expertise as a service or require licensing, like architecture, financial advice, real estate, design, or hairstyle services.

  4. Cyber Liability Insurance.

    According to the FBI, internet crimes rose in 2021. People living in California were the hardest hit, with losses of over $1.2 billion. Healthcare and professional services are among the most common small business industry victims.  Cyber Liability Insurance coverage is recommended for California small businesses to help with customer notification and fraud monitoring costs following a cyberattack and the associated legal fees. Having Cyber Insurance helps your small business recover from common cyberattacks.

Our Small Business Insurance Company Is Here to Help

B2Z understands that insurance can be confusing, so we set out to make it understandable and easy to purchase.
  1. Q
    Does B2Z offer small business coverage in California?
    A

    Yes! We currently offer the following types of insurance policies to small business owners in California:

  2. Q
    How do I get a quote for my small business insurance in California?
    A

    It’s simple: Click on the Get Your Quote button and answer a few questions. And if you like what you see, purchase your policy online!

* Sources:

US Small Business Administration (PDF)

DMV CA

CA.gov