How much is e-commerce insurance for online retailers?

Retailers, including e-commerce stores, pay an average of $95 per month, or $1,136 per year, for a business owner's policy.

A business owner's policy bundles general liability insurance with commercial property insurance at a lower cost than buying these policies separately. You can often include additional coverages as well.

A BOP provides coverage in the event of a fire, storm, or theft at your business address. It also protects against liability claims related to bodily injuries and property damage, such as a delivery driver who trips on a broken step and breaks their wrist.

Common add-ons include business interruption insurance (or business income coverage) to cover lost income and operating costs during a temporary closure, and equipment breakdown coverage to help your business recover from the failure of a point-of-sale system or other necessary equipment.

This is the average BOP for retail businesses that buy from TechInsurance:

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

Businesses that are eligible for a BOP are usually small in size (fewer than 100 employees) and low risk.

The cost of a business owner's policy depends on factors such as the amount of property coverage you need, your business operations, and whether your store is protected with a burglar alarm or other security measures.

General liability insurance for retail stores, including e-commerce shops, costs an average of $42 per month, or $500 per year.

This type of insurance covers accidental property damage and customer injuries. It usually includes product liability insurance, which protects your business against legal expenses if a customer sues over harm caused by a product.

General liability insurance also pays for lawsuits related to advertising injuries, such as defamation or copyright infringement. It would cover legal costs if you published a customer's photo on social media without permission, or slandered a competitor in an online ad.

Below is the average general liability policy for retailers that buy from TechInsurance:

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

You might need general liability coverage to sign a contract with an online marketplace like Amazon, or to get a business loan. It shows clients and partners that they're protected against financial losses from the most common risks.

The cost of general liability insurance depends on numerous factors, including the type of products you sell, the policy limits and deductible you choose, and whether you add any endorsements, such as an additional insured. Businesses without a storefront can expect to pay less for this coverage.

E-commerce companies and other retail businesses spend an average of $86 per month, or $1,036 annually, on workers' compensation insurance.

Workers' comp pays for medical expenses and disability benefits in the event of an employee injury. For example, if an employee drops a heavy box on their foot and breaks a bone, this policy would pay for their medical costs and provide partial wages during their recovery.

Workers' compensation policies usually include employer's liability insurance. This type of coverage pays for legal costs if an employee sues their employer over an injury.

State laws often require retailers to secure workers' comp as soon as they hire their first employee, but that's not always the case. It's required in California and New York for every business with employees, in Florida for every business with four or more employees, and it's optional for most companies in Texas.

Even though workers' comp may not be required for sole proprietors or independent contractors, such as an online shop run by one person, it's still recommended. Medical bills are expensive, and most health insurance plans can deny claims for injuries that happen on the job.

The cost of workers' compensation mostly depends on the number of employees you have and the type of work they do. It's often less expensive for businesses in states that have lower healthcare costs.

The average cost of cyber insurance for retailers, including online stores, is $57 per month, or $683 annually.

This policy covers expenses related to cyberattacks and data breaches. It can pay for cyber incident investigations, provide reimbursement for ransomware payments, and help with costly customer notifications, which may be required by state laws after a breach.

Cyber insurance is crucial for stores that collect customer data, such as email addresses and credit card numbers. It's sometimes called cyber liability insurance or cybersecurity insurance.

The cost of cyber insurance mostly depends on the type of business you own, the amount of personal information you handle, and the cybersecurity measures you take against hackers and other threats.

E-commerce shops and other retailers pay an average of $59 per month, or $707 per year, for commercial umbrella insurance.

This policy provides financial protection in the event that the coverage limits on your general liability, employer's liability, or commercial auto insurance aren't enough to cover an incident.

Umbrella coverage boosts your underlying insurance policies in $1 million increments. You might need it to sign a contract with a shipper or supplier who requires higher than average liability limits.

Even when it's not required, you should consider carrying this type of insurance. It helps protect against the most expensive claims, such as multi-vehicle accidents or products that harm many customers.

Umbrella insurance does not apply to professional liability insurance (also called errors and omissions insurance), which covers lawsuits related to the quality of your work. Excess liability insurance can boost the coverage of a single policy, including professional liability coverage.

The cost of umbrella insurance mostly depends on the amount of coverage you buy. Your insurance company will also consider the same factors that affect the cost of the underlying policies.

Retail businesses, including those that sell online, pay an average of $171 per month, or $2,054 per year, for commercial auto insurance.

If your company vehicle is involved in an accident, this policy would help cover any damage you caused. It would also pay for your legal fees if you're sued.

You can buy coverage for other risks as well. For instance, collision insurance pays for repairs if your vehicle is damaged in a collision, while comprehensive insurance covers damage to your vehicle from other sources, such as hail, theft, and vandalism.

Almost every state requires this coverage for businesses that own a vehicle, as personal auto insurance won't cover business driving. To protect personal, rented, and leased vehicles used for work, you'd need hired and non-owned auto insurance (HNOA) instead.

The cost of commercial auto policies can vary considerably. Some of the most important factors are your employees' driving records, the policy's limits and deductible, the number of vehicles you own, and the coverage options you choose.