New Business Insurance Checklist

1. 1

   Identify your industry's NAIC code

   Insurance carriers price commercial coverage primarily based on the North American Industry Classification System (NAIC) code that matches your business. Look yours up at naics.com/search. Write down the 6-digit code — you'll be asked for it on every quote application.

   💡 Tip: Pick the NAIC that most-accurately matches your primary revenue source, not a less-risky adjacent code. Misclassification is the #1 source of denied claims at audit.
2. 2

   Decide: Sole Proprietor vs LLC vs Corporation

   Your legal entity changes which policies you NEED. Sole proprietors with no employees may skip Workers Comp in most states. Single-member LLCs are treated similarly. Multi-member LLCs and corporations with employees almost always need Workers Comp.

   💡 Tip: An LLC does NOT shield you personally from negligence claims arising from work you personally performed — General Liability still protects you, even with an LLC.
3. 3

   Determine if you need General Liability (GL) — almost always YES

   General Liability covers third-party bodily injury, property damage, and personal/advertising injury claims. Almost every commercial lease, vendor contract, and event-permit application requires proof of GL ($1M per-occurrence / $2M aggregate is standard).

   Read our full GL guide →

4. 4

   Decide: standalone GL or Business Owners Policy (BOP)?

   If you have physical business property worth more than a few thousand dollars (computers, equipment, inventory, leased-space improvements), a BOP — which bundles GL + Commercial Property — is usually more cost-effective than buying separately.

   Read our BOP guide →

   💡 Tip: Most BOP carriers cap eligibility at ~$1M-5M in annual revenue and limited employee counts. If you don't qualify, you'll buy GL + Commercial Property as separate policies.
5. 5

   Check your state's Workers Comp requirement

   Nearly every state requires Workers Comp once you have one or more employees. A few states have different thresholds. Texas allows opt-out (but exposes you to civil tort liability — generally not advisable). California, Florida, New York, and others have strict 1-employee triggers.

   Read our Workers Comp guide → for state-by-state details cited from NAIC.

   💡 Tip: Independent contractors are NOT employees for WC purposes — UNTIL a state DOL audit reclassifies them. AB5 (California), the federal DOL economic-realities test, and state-specific ABC tests are all places this trap appears.
6. 6

   If you use a vehicle for work, get Commercial Auto

   Personal auto policies EXCLUDE commercial use. If you drive to client sites, deliver products, or carry tools/equipment, you need Commercial Auto. Hired and Non-Owned Auto (HNOA) is a cheaper alternative if you only OCCASIONALLY use personal vehicles for business.

   Read our Commercial Auto guide →

7. 7

   If you provide professional advice or services, get Professional Liability (E&O)

   Consultants, accountants, attorneys, design professionals, IT services, marketing agencies, and other advice-based businesses face Errors & Omissions claims that General Liability does NOT cover. Pro Liab fills that specific gap.

   Read our Professional Liability guide →

8. 8

   Consider Cyber Liability if you handle customer data

   If you store, process, or transmit personally identifiable information (PII) — including payment cards, social security numbers, or medical data — Cyber Liability covers breach response, regulatory defense, and customer notification costs. Increasingly required by enterprise B2B customers.

9. 9

   Get an ACORD 25 Certificate of Insurance — and learn to read it

   Your carrier or agent provides an ACORD 25 Certificate of Liability Insurance as proof of coverage. Your landlord, vendors, and clients will ask for it. Understand what it does and doesn't represent →

   💡 Tip: A COI does NOT extend coverage to the certificate holder — it's informational only. To grant them rights under your policy, you need to add them as an Additional Insured.
10. 10

    Compare quotes from multiple carriers

    Commercial insurance pricing varies substantially between carriers for identical risks. We typically see a 30-60% spread between the highest and lowest quote for the same NAIC + state. Compare at least 3-5 carriers before buying. You can compare 10+ carrier quotes through us in about 5 minutes.

11. 11

    Read your Declarations Page carefully — every renewal

    The Declarations Page is the customized first page of your policy listing coverage types, limits, deductibles, and premium. Re-read it at every renewal — carriers can change endorsements, limits, or premium without obvious announcement.

12. 12

    Talk to a licensed agent in your state before buying

    This checklist is educational. Coverage selection requires state-specific knowledge of regulations, carrier appetite, and your specific business operations. Use this checklist to ARRIVE at your conversation with a licensed agent informed and ready — not to substitute for it.

    If you'd like to start the comparison, our network reviews quotes from 10+ commercial carriers. Get matched →