Best Business Insurance in Ontario for 2024
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Today, Ontario hosts over 420,000 companies of which 98 percent are classified as small businesses.
Whether you are running a hair salon in Toronto or a construction firm in Ottawa, any small business working in Ontario today has to deal with its own unique set of risks. Unforeseen costs can cripple your business and its availability to function, so it is always important to play things safe.
We’ve written a guide to help you get the kind of protections you need so you can get back to focusing on the important stuff – the day-to-day running of your business.
What is business insurance in Ontario?
Business insurance protects small businesses in Ontario against unforeseen events, accidents and other forms of liability. These usually include personal injury, property damage or a business service not having been rendered as advertised among others. The provision of business insurance in Canada is overseen by regulators on both the national and state level. In Ontario, the Financial Services Commission of Ontario (FSCO) provides regulatory oversight to ensure consumers are protected and is accountable to the Minister of Finance.
Most business insurance policies will be tailor-made for the industry, revenue and size of the business in question, and consist of paying a premium upfront, followed by payments in monthly installments. Generally speaking, they offer a host of different forms of protection, usually including the following three kinds of insurance products:
| Coverage type | How it works |
|---|---|
| Commercial general liability insurance | Often referred to as CGL insurance, commercial liability insurance protects your business against claims that allege third-party injury or property damage. |
| Professional liability insurance | Also often referred to as Errors & Omissions Insurance, professional liability insurance provides cover for businesses against claims alleging misconduct, negligence or any failures to deliver a service as advertised. |
| Commercial property insurance | Commercial property insurance provides cover for your business in the event of the loss or damage of your property due to unforeseen events such as thefts, fires and other kinds of disasters. |
Why do I need business insurance?
Sometimes unforeseen events pose costs that small businesses do not have the available funds to deal with. This can be the case due to natural disasters or legal costs. In the event that a claimant launches a lawsuit against your company, legal fees can quickly spiral out of control. With two-thirds of commercial enterprises going out of business after incurring a major loss without the correct kind of business insurance coverage, it is essential that companies take steps ahead of time to shield themselves from risk. The right kind of business insurance policy will make sure you are protected when you need it most.
Ready to start comparing business insurance policies? It is fast and easy to get a free quote.
What does business insurance in Ontario cover?
A comprehensive business insurance package would see you protected from the following kinds of risks:
- Flood damage / Fires / Hurricanes / Tornados
- Burglary
- Car crashes
- Loss of income
- Lawsuits
- Database breaches
- Property damage
- Injury or bodily harm to clients on the business premises
- Employee injuries/illnesses and worker compensation.
Business insurance always includes Commercial general liability insurance (CGL) at the very least. Different kinds of companies require different forms of coverage though and policies are almost always crafted with these specifics in mind. A chain of restaurants in the suburbs of Hamilton deals with a different set of liabilities than a cyber security company located in downtown Toronto. As specified above, CGL insurance usually appears alongside professional liability insurance and commercial property insurance. Additional insurance products such as commercial vehicle insurance and cyber security insurance might be useful add-ons as well, but it all depends on which industry you are working in.
How much is business insurance in Ontario?
One leading small business insurance broker estimates that small businesses should expect to pay at least $450 a year for basic protections, while other providers peg the cost as anywhere between $500-2,000. The truth is the cost of business insurance will depend on a lot of different factors, including your industry and its particular set of risks as well as the size of your company and its revenue. Other factors often taken into account include how long your business has been operational, your claims history and the location of your business. No two businesses are alike.
Here is an example to help illustrate how it works:
For example
Michael is a small business owner operating a cafeteria in downtown Kitchener, Ontario for office workers. He purchases a business insurance policy with the typical three forms of coverage – CGL insurance, professional liability insurance and commercial property insurance – as well as commercial vehicle insurance to help deliver food to and from his business premises. Because he doesn’t handle much in the way of sensitive client data, he doesn't opt for cyber insurance and pays a monthly premium of $75.
What is the cheapest business insurance in Ontario?
The insurance broker Zensurance advertises insurance policies for as little as $200 dollars per year for small businesses in Ontario. This is, however, for the most limited form of coverage possible. Most rates will be significantly more expensive than this.
Remember that the cheapest insurance does not mean the best insurance. Purchasing a more limited form of protection leaves your business exposed to more financial risks should anything go wrong. Instead, small businesses are advised to search for the best policy available, which will include the most extensive form of protection specific to your industry for the lowest cost available.
Would you like to find industry-specific coverage for your business? Compare now to get the cheapest business insurance rate that offers you the right coverage.
Better protection for your business today
How do I get business insurance quotes in Ontario?
You can get yourself a business insurance quote by clicking on the button on the top right-hand corner of this page. If you scroll up you will also find a list of registered providers and can get in touch with a business insurance broker today. Click on the link, fill out the requested information and you will have a great quote in moments.
Prefer to go directly through a specific insurer? Most providers also have dedicated hotlines so if you are struggling, give them a call.
What business insurance add-ons are available in Ontario?
A variety of business insurance add-ons are available upon request that cater to the specific demands of your company. These include but are not limited to the following:
| Insurance add-on | How it works |
|---|---|
| Business assistance services | Some insurance companies offer consulting services that help your business insulate itself from unnecessary risks, even after you have purchased your policy. This can involve helping your business implement loss prevention techniques that change and adjust in accordance with the nature of the services you are providing at a given time. |
| Commercial vehicle insurance | In the event that you use a vehicle for commercial purposes in the context of your business, commercial vehicle insurance makes sure you and your employees are covered. A commercial fleet policy is usually available upon request if you use multiple vehicles. |
| Cyber liability insurance | Cyber liability insurance, also referred to as Data protection insurance, protects your business against data breaches and other cyber security issues, often stemming from cyber crime or systems failures. With businesses often handling sensitive client information such as medical or financial records, cyber liability insurance provides a range of protections against loss of income and potential lawsuits. |
| Directors and officers insurance | Directors and officers insurance provides coverage should a legal claim be brought against a particular individual in your company. This ensures the professional risks undertaken by your personnel while doing their job will not result in personal financial losses or affect personal assets. |
| Product liability insurance | Product liability insurance protects businesses in the event that a product they have sold and distributed causes damage or injury to a third party. |
| Surety bonds | Surety bonds are third-party guarantees usually used in the construction industry to guarantee the fulfillment of a particular service. They provide additional security in the event things don’t go according to plan, where obligees (the person carrying out the service) is reimbursed the value of the bond to help cover costs. |
What business insurance discounts are available in Ontario?
Discounts for business insurance are typically available when you bundle different forms of insurance together. That means if you already purchase your commercial car insurance from one provider, getting additional business insurance might be marginally cheaper because you already have a pre-existing policy. If you can demonstrate a claims-free record with your other policies, you might also find yourself paying less for your premiums and monthly fees. Additional discounts will be particular to the insurance companies providing the policy – in order to find out more, just go to their website and correspond with one of their dedicated insurance specialists over the phone or via email.
Let's take a look at an example:
For example
Janet is a small business owner in Hamilton, Ontario who runs a laundromat. She purchased a business insurance policy with the same provider who insures her car and her home. She opts for CGL insurance, professional liability insurance and commercial property insurance in her policy. Her insurance broker tells her that her monthly premium would have $50, but because she has been claims-free for the past decade and already has two existing insurance policies with the same company will pay $35 per month instead.
Is business insurance tax deductible in Ontario?
Generally speaking, business insurance in Ontario is tax-deductible. Because insurance is considered a business expense, it can be deducted from your business’s taxable income. This is provided that the insurance policy is standard practice in your industry and considered necessary. This precedent is the case throughout Canada and applies to most forms of insurance with the exception of life insurance, although some exceptions do apply. Talk to a licensed insurance provider to get more information.
Want to learn more? Get in touch with a business insurance broker now.
