According to the US Small Business Administration, New Jersey has the highest number of small businesses in the country, making up 99.6% of companies; it is the seventh-highest number of small businesses in the country. In 2021, roughly 1 million New Jersey small businesses employ 1.9 million employees or almost half of New Jersey's private workforce. That number is increasing yearly, with small businesses creating more than 33,000 new jobs in 2015.
Many programs and services exist in New Jersey for businesses seeking financial assistance and help. These include small business lending, growth funds, tax credit programs, and more. But because of some of the tightest worker protection laws in the nation, including new laws governing nondisclosure agreements, New Jersey business owners need to secure their businesses with comprehensive commercial insurance policies.
There is a wide variety of businesses in New Jersey that needs business insurance, including:
- Real Estate
- Computer, IT, and Technology
- Health Care
Non-compliance with specific New Jersey laws may leave your business vulnerable to liability, especially if your insurance does not cover you. NJ law mandates that all companies with employees carry workers' compensation insurance for those employees. Any business with at least one employee may qualify for coverage through a private insurance company or become self-insured. All vehicles, including those commercially owned, require insurance to operate on public roads. Other general business insurance, such as a BOP or general liability, is not required by law. Still, business contracts typically include a requirement to carry general liability insurance.
Types of Commercial Insurance in New Jersey
General Liability Insurance
General liability insurance is the first thing most New Jersey business owners should purchase. It covers liability for third-party injury, property damage, personal injury, and advertising damage. General liability insurance can be included with property insurance in a Business Owners Policy (BOP), or a commercial package policy, but it's available as a stand-alone policy as well.
You will inevitably require liability insurance as a contractor or small business owner. A single lawsuit could put your business on the hook for negligence, damages, and defense costs you may not be able to pay for your own. One way to minimize the possibility of this is to ensure you have adequate liability insurance.
Commercial Auto Insurance
Commercial automobile insurance consists of auto liability and physical damage coverage for owned vehicles, such as cars, trucks, and vans, used in business. Physical damage coverage safeguards your vehicles and trailers for damage from collision, theft, or fire. Auto liability covers bodily injuries or property damage stemming from the liability arising out of the automobile’s use. Personal auto insurance may not cover cars while they're being used for business purposes, which makes it very important to have commercial auto coverage for company vehicles.
Workers compensation insurance, also known as workers comp, pays for medical costs and some of the lost wages of employees who have been injured while on the job. Coverage also extends to the expense associated with employee rehabilitation and death benefits. If the business has one or more employees, it must have workers' compensation insurance in New Jersey.
Business Owners Policy (BOP)
A BOP combines property and liability insurance into a single, convenient policy. It is excellent for small to medium-sized businesses that rent or own business space, such as retail stores, warehouses, or offices. A business owner’s policy contains two primary coverages:
- General Liability - BOP coverage levels are the same as a standard liability policy. It will protect you against events like third-party property damage, third-party bodily injuries, advertising injuries, and product liability claims. On the other hand, a BOP does not provide any protection for your employees. Your business needs to purchase worker's compensation for employee injuries. It will also not cover professional exposures, cyber incidents, and employment practices liability.
- Business Property - Provides coverage for owned structures and personal property, such as office buildings and contents used by the enterprise for its income-generating activities. Contents consist of furniture, fixtures, inventory, equipment and other items used to operate the business. Property coverage is only applicable for property while at your business location, for property away from your premises, you need Inland Marine.
Coverage for consultants, legal professionals, engineers, architects, real estate agents, and accountants that protects them from claims of negligence related to the professional services performed is known as professional liability insurance. It is also called errors and omissions insurance. Due to the complexity of the services offered, professionals require this coverage for when a mistake or oversight, causes a financial loss to their clients. When Professional services are offered by New Jersey companies, they should consider this coverage.
Cyber insurance protects against damages resulting from electronic threats to your computers or data. These threats can result in damage to or theft of sensitive information, hardware or other crucial technologies. A cyber incident could result in downtime and recovery costs that often include specialized repairs and legal fees. Coverage is available to cover incident response services, first-party losses (your own), and third-party losses (experienced by others for which you're to blame). This coverage is sometimes called cyber risk or cyber security insurance. Businesses that store or manage customer private data, or any business operating online really needs to get Cyber.
New Jersey Small Business Insurance Requirements
Not having the proper insurance can put your business at risk since New Jersey state law requires certain types of coverage. These policies must be accepted everywhere in New Jersey, from Trenton to Newark:
- Workers' compensation insurance
New Jersey requires every business to carry workers' compensation insurance for their employees, regardless of whether they work for the company full-time or part-time.
This policy covers medical expenses resulting from occupational injury and disease. This policy covers medical bills for work-related injuries and illnesses. It also provides disability benefits for New Jersey workers injured on the job.
- Commercial Auto Insurance
All vehicles owned by individuals and businesses in New Jersey must be covered by commercial auto insurance. This policy covers the costs resulting from vehicle accidents and vehicle damage from other causes.
New Jersey offers both simple and standard auto insurance policies. The standard plan features a minimum of the following:
- $15,000 per person bodily injury liability
- $30,000 per accident bodily injury liability
- $5,000 property damage liability per accident
- $15,000 personal injury protection (PIP)
Trucking companies may need additional insurance to meet their statutory requirements.
Cost of Business Insurance in New Jersey
General liability for some small New Jersey businesses typically cost about $64 monthly. Although the insurance premium for your company will depend on several factors, such as:
Regular risk factors in your industry - Businesses that face more significant threats of damage and injury should expect to pay more for insurance coverage. For example, contractors in New Jersey pay an average premium of $86 per month, while professional service providers spend more per month when including professional liability insurance premiums
The types of insurance you buy and your policy limits - When purchasing an insurance policy package, to keep your premium costs low, you might be inclined to leave out some coverage types or choose lower limits. However, this may not be in your best interest. While you may save a little money each month, you will likely pay much more if you get in an accident and need to report it.
How many people you employ - how much you will pay for workers' comp insurance primarily depends on your employee payroll by job duty. Make sure to update your company's employee payroll before you request a workers’ compensation insurance quote.
Location- Auto insurance premiums, both personal and business, are rated according to certain zones. Typically more congested areas pay higher premium because the more traffic in an area translates to more accidents.
Get a Quote for New Jersey Business Insurance
If you need to get a quote for your New Jersey business, please visit us at InsuranceAdvisor.com. Choose your state, then choose from General Liability, Commercial Property, Business Auto, and Workers’ Compensation insurance and answer the application questions. Once we receive your request, we will provide you with a quote as quickly as possible.
Why Choose Insurance Advisor for Commercial Insurance in New Jersey?
We are licensed to provide insurance in New Jersey and can provide your business with quotes from different insurance carriers. You can request quotes for your business from the comfort of your home, office, or anywhere by visiting us at InsuranceAdvisor.com. Once you create an account, your business information is stored, and you can come back at any time to request quotes for other lines of insurance, get a certificate of insurance, renew, and update your information.
Frequently Asked Questions (FAQ) about New Jersey
1. How much is business insurance in New Jersey?
A monthly premium for a BOP is around $261 per month, or about $3,135 annually for a small business. Concerning the variety of policies available, every company will require some type of insurance coverage. Some aspects that influence premium calculations include:
- Type of business
- Payroll by job duty
- Policy limits
- Other types of insurance purchased
- Claims history
The easiest way to calculate costs for your enterprise is to get a quote from an experienced commercial property & casualty insurance agent.
2. Where can I get inexpensive business insurance in New Jersey?
The old saying, “You get what you pay for,” is very true with all types of insurance. If you want more incidents to be covered, you will pay more for insurance. The cheapest insurance is never the best insurance. Get more than one quote from the same or different agents so you can see how one insurance company’s rates compare to another’s. Always read the exclusions in the policy. This is where you find what is NOT covered. Get an affordable option with the most common mishaps likely to happen to your business insured and not listed under exclusions.
3. What types of business insurance are recommended for businesses in New Jersey?
Recommended insurance policies for small businesses in New Jersey are:
- General Liability
- Commercial Auto
- Workers' Compensation
- Business Property
- Professional Liability
- Cyber Insurance
4. Which insurance companies are best in New Jersey?
As a New Jersey-licensed commercial insurance agency, we will determine the best insurance company for your business. Insurance companies often specialize in specific business industries which can vary from state to state. An independent insurance agent matches your business with carriers that can fulfill your company's insurance needs. Visit us at InsuranceAdvisor.com to request a quote.
5. How to find out if a business has liability insurance in New Jersey?
If you have a vendor or service provider that you want to verify general liability insurance, just request a certificate of liability insurance from them. This standardized form will provide the insurance company name, policy number, coverage information, and limits carried. If still in doubt, call the insurance agency listed on the certificate and request confirmation of the insurance's validity.