How much does e-commerce insurance cost for online retailers?

Online stores pay an average of $95 per month, or $1,136 per year, for a business owner’s policy.

A business owner's policy, or BOP, bundles general liability coverage with commercial property insurance to cover both third-party claims and your business property. It typically costs less than purchasing each policy separately.

A BOP protects against customer injuries, property damage, and vandalism. Because of its increased coverage and affordability, it’s the policy most often recommended by Insureon’s agents.

This is the average BOP for e-commerce businesses that buy from Insureon:

Insurance premium: $95 per month
Policy limits: $1 million per occurrence; $2 million aggregate
Deductible: $500

Small, low-risk online retailers are often eligible for a business owner's policy.

E-commerce store business owners may see higher costs if they choose to add endorsements to their policy. Insurance endorsements, such as business interruption insurance or equipment breakdown coverage, are often recommended to help avoid financial losses if a fire or power outage forces your business operations to cease for an extended period of time.

The cost of a business owner's policy is based on a number of factors, including high-value property, where you are located, your business income, the number of employees you have, the amount of property coverage you need, and your specialty.

E-commerce businesses pay an average of $42 per month, or $500 per year, for general liability insurance.

A general liability policy helps cover legal fees related to common third-party lawsuits from clients, including those related to customer bodily injury (such as a customer slip and fall incident), damage to a client's property, copyright infringement, and advertising injury.

General liability coverage often includes product liability insurance, which can help protect your online retail store in the event a customer has an allergic reaction to a product your business sells.

This is the average general liability insurance policy for e-commerce stores that buy from Insureon:

Insurance premium: $42 per month
Policy limits: $1 million per occurrence; $2 million aggregate

The cost of general liability insurance depends on several factors, such as the coverage limits you choose, the size of your business, the amount of foot traffic you have, policy exclusions, and any endorsements you may add, such as an additional insured.

Learn more about how your insurance premium is calculated and how to save money on your general liability coverage.

For online store businesses, workers’ compensation insurance costs an average of $86 per month, or $1,036 per year.

This business insurance coverage helps pay for medical expenses when an employee is injured on the job. It also provides disability benefits to help cover lost wages while they're recovering and unable to work.

To comply with your state’s requirements and avoid penalties, online retailers need this coverage for their employees. It's also recommended for sole proprietors, as health insurance plans can deny claims for medical bills when an injury or illness is related to your job.

Most policies include employer's liability insurance, which covers the cost of lawsuits related to employee injuries. There's usually no limit to how much workers' comp insurance covers for employee benefits, though it depends on state laws.

The cost of workers' compensation insurance depends on several factors, including the number of employees you have and the level of risk involved with their jobs.

You can save money on your workers' comp coverage by classifying your workers correctly and implementing a risk management plan to minimize employee injuries.

E-commerce shops and other retail business owners pay an average of $57 per month, or $683 annually, for cyber insurance. You might also see this policy called cyber liability insurance or cybersecurity insurance.

Cyber insurance helps online businesses recover financially after a hacker accesses customer information through a data breach or cyberattack. It can help pay for customer notification costs, fraud monitoring services, and other costs necessitated by state data breach laws.

The cost of cyber insurance depends on the amount of customer data handled by your retail business, such as customer credit card numbers, along with the number of employees who can access that information.

E-commerce stores and other retail businesses pay an average of $59 per month, or $707 annually, for commercial umbrella insurance, which is available in $1 million increments.

This policy boosts the protection of your general liability insurance, commercial auto insurance, and employer's liability insurance. When a claim exceeds the limits of the underlying policy, umbrella insurance kicks in to provide coverage.

While umbrella insurance extends coverage limits for a number of policies, it doesn't apply to professional liability insurance, also called errors and omissions (E&O) insurance. This policy covers lawsuits over professional mistakes, including undelivered services and missed deadlines. Your business can expand policy limits for professional liability or E&O insurance coverages with excess liability insurance.

Online retailers may need commercial umbrella insurance if a landlord requires liability coverage in excess of $2 million.

For example, a landlord might require you to show proof of insurance for $3 million in general liability coverage before they'll sign a lease. In that case, you could carry $2 million in general liability insurance along with a $1 million umbrella policy to meet this requirement.

The cost of umbrella insurance depends on your risks and how much coverage you buy. You need to buy a certain amount of underlying coverage before you can buy umbrella insurance.

E-commerce companies and other retail stores pay an average of $171 per month for commercial auto insurance, or $2,054 annually.

Most states require this coverage for vehicles owned by an online retail store. For personal, rented, and leased vehicles used by your business, look to hired and non-owned auto insurance (HNOA) instead.

A commercial auto policy provides financial protection in the event of an accident involving your business vehicle. It can help pay for property damage, medical costs, and legal expenses.

The cost of commercial auto insurance depends on several factors, including the policy limits you choose, coverage options, the value of the vehicles, and the driving records of anyone permitted to drive.

Learn more about how to find affordable commercial auto insurance coverage.