Professional Services (Low Risk)
Retail / Wholesale (Medium-Low)
Food & Hospitality (Medium)
Construction & Contracting (High Risk)
Manufacturing (Medium-High)
$500,000
$1,000,000
$2,000,000
$5,000,000
Base General Liability:$0.00
Workers' Comp Estimate:$0.00
Revenue Risk Adjustment:$0.00
Estimated Total Annual Premium:$0.00
*This is a preliminary estimate. Actual quotes depend on claims history, location, and specific policy riders.
How Business Insurance Premiums Are Calculated
Calculating business insurance costs isn't just about the size of your office. Insurance underwriters look at a variety of variables to determine the likelihood of a claim. The main components include your industry risk profile, your payroll (which drives Workers' Compensation), and your total revenue (which indicates the scale of potential liability).
Key Factors Influencing Your Rate
Industry Risk: A roofing contractor faces significantly higher liability and safety risks than a graphic designer. High-risk industries carry a multiplier that can double or triple base premiums.
Payroll & Employees: Workers' Compensation is directly tied to your payroll. More employees generally mean a higher probability of workplace injuries.
Revenue: Higher revenue often correlates with more interactions, more products sold, or larger contracts, all of which increase the potential "surface area" for legal claims.
Coverage Limits: Choosing a $2 million aggregate limit instead of $1 million will increase your premium, though usually not linearly.
Example: Small Retail Shop
Imagine a retail boutique with $400,000 in annual revenue and 2 employees.
In a medium-low risk category, they might see a General Liability base of $600, plus roughly $1,200 for Workers' Comp, totaling around $1,800 to $2,400 per year depending on the location.
Types of Coverage Included in This Estimate
This calculator provides a combined estimate for General Liability (GL) and Workers' Compensation. General Liability protects your business from bodily injury or property damage claims, while Workers' Comp covers medical costs and lost wages for employees injured on the job. For many small businesses, these are the two mandatory pillars of protection.
Why Accurate Estimates Matter
Underestimating your revenue or employee count can lead to "premium audits" at the end of the year, where the insurance company charges you the difference. Using a calculator like this helps you budget effectively and ensures you aren't surprised by year-end adjustments.
function calculateBusinessInsurance() {
// Get Input Values
var riskMultiplier = parseFloat(document.getElementById('industryType').value);
var revenue = parseFloat(document.getElementById('annualRevenue').value);
var employees = parseFloat(document.getElementById('employeeCount').value);
var limit = parseFloat(document.getElementById('coverageLimit').value);
// Validation
if (isNaN(revenue) || revenue < 0) { revenue = 0; }
if (isNaN(employees) || employees 1) {
baseGLVal = baseGLVal * (1 + (limitFactor – 1) * 0.3);
} else if (limitFactor < 1) {
baseGLVal = baseGLVal * 0.8;
}
// Logic: Workers Comp Estimate
// Average cost per employee approx $400 for low risk, scaled by industry
var workersCompVal = employees * 450 * riskMultiplier;
// Logic: Revenue Risk
// $1 per $1000 of revenue, adjusted by risk
var revenueRiskVal = (revenue / 1000) * 1.1 * riskMultiplier;
// Totals
var total = baseGLVal + workersCompVal + revenueRiskVal;
// Display Results
document.getElementById('baseGL').innerHTML = '$' + baseGLVal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('workersComp').innerHTML = '$' + workersCompVal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('revRisk').innerHTML = '$' + revenueRiskVal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('totalPremium').innerHTML = '$' + total.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('insuranceResult').style.display = 'block';
}