How Much Does Texas General Liability Insurance Cost? (2023 Rates)

Thang Truong
Thang Truong
Updated on:

Texas has been named the best state for business for the 17th year in a row. That’s great news if you’re a business owner in Texas. What makes Texas so special? Things like no corporate or personal income tax, a stable regulatory climate, and a young skilled workforce make Texas a fantastic place to launch a business or grow a more established one. 

But before you start spending your profits, you’re going to need some business insurance. General liability insurance is one of the most popular business insurance policies for small businesses that will protect you from unwanted lawsuits.

How much does general liability insurance cost in Texas?

A small business in Texas can expect to pay anywhere from $300 to $5,000 a year for a general liability insurance policy. 80% of small businesses pay around ~$1,400 a year for this policy to protect their businesses from the most common lawsuit in for small businesses.

These are just the average rates. Be sure to shop around with a few companies or with a digital broker like CoverWallet or commercialinsurance.net to compare several quotes to find the cheapest one for your business.

What affects how much you pay for general liability insurance?

There are many factors that go into how much you’ll pay for your insurance. Some of them include:

Amount of coverage

Higher amounts of coverage are obviously more expensive and you will have to pay more. Lower coverage will result in lower premiums. However, lower coverage might not be enough to cover all expenses when you are sued, so be sure to select the right coverage limit for the policy. Small businesses usually have $1M/$2M coverage for their general liability insurance coverage.

Deductibles

The higher the policy’s deductibles are, the lower the premiums are. However, you need to be mindful selecting the right deductible amount that your business can afford when it needs to.

Type of business

Higher risk industries pay more for insurance. If you’re a contractor, for example, there is a lot of potential for clients, customers, and passersby to trip over something and injure themselves. If you’re a locksmith, the risk is much lower. In general, construction, contracting, and trucking businesses are paying the most while accounting or IT services are paying the least for general liability insurance policy.  

How many years of experience you have in this industry

The more experience you have in your current industry, the less likely you will have lawsuits since you have accumulated sufficient experience to do the right things and follow the right process to avoid lawsuits.

How many years you’ve been in business

The longer you have been in business, the less likely that you’ll have lawsuits since you have learned how to manage your business the right way and have established the right safety practices for your business to avoid accidents and lawsuits.

How big your business is

General liability insurance is most commonly known to protect against slip-and-fall accidents by your customers. The more customers equal more opportunities for one of them to injure themselves. The more storefront your business has, the more likely accidents happen.

Location

If you’re reading this, your location is Texas, but some cities in Texas will have higher rates than more suburban or rural locations. Business locations in populated cities are smaller and more crowded with customers, which will be likely to cause accidents.

Claims history

If you’ve had claims before, your rates will be higher. If you have a clean record, no claims, your rate will be lower.

How much general liability insurance do I need?

Most small businesses would do well with the standard coverage, which is $1 million per occurrence and $2 million aggregate.

If your business is very large or particularly risky, like construction, you may want to opt for higher limits. If your business is in low-risk industries such as IT or accounting consulting, you might want to have lower coverage to reduce costs.

How can I get cheap general liability insurance?

Small business owners in Texas want to save as much money as they can on insurance without sacrificing coverage. How do you that?

Compare several quotes

One of the best ways to save money on insurance is to compare prices from at least two or three companies. You might be surprised at how much rates can vary for the same amount of insurance coverage from different companies.

Ask for discounts

Remember to ask about discounts. If you buy more than one type of insurance, if you have a membership in a professional organization, or paying in full will often earn you a discount. It doesn’t even have to be business insurance. You can bundle home or auto insurance to get a discount if the company offers those types of policies. 

Consider increasing your deductible.

This will save you some money, but make sure you can cover the costs if you need to file a claim. 

Don’t get more insurance than you need

You want to buy enough coverage in case of a claim but buying too much is just a waste of money. Choose an amount that offers protection without over-insuring. 

Make sure you promote safety in your workspace

Post a safety plan, encourage safe behaviors and don’t leave things lying on the floor for someone to trip over. 

Learn more at the cheapest general liability insurance companies.

How to buy general liability insurance online in Texas

You have options! When you go to purchase general liability insurance in Texas, you can choose from the following:

Traditional insurance companies:

Traditional insurance companies have the advantage of decades of experience, strong financial strength and sometimes the personal attention of an insurance agent. 

  • The Hartford
  • Liberty Mutual
  • Chubb
  • Hiscox

This is a quote from Hiscox for an IT consulting firm based in Boise, ID with two employees and $500,000 in revenue a year. 

Graphical user interface, text, application, email

Description automatically generated

Insurtechs:

People are very comfortable buying goods and services online. Insurtechs have lower operating costs, and therefore can offer better rates. Especially after the pandemic, more and more people have turned to the internet to fulfill their insurance (and other) needs. You can get a quote, buy insurance, manage your policy and file a claim, all without leaving your own office/living room.

  • Next
  • Thimble

The following quote is from Thimble. You may notice this is much higher than the quote from Hiscox, even though it’s the same (imaginary) company. The great thing about Thimble is that you can buy insurance for as long as you need it: a month, two months, a year, a day or an hour. 

Graphical user interface, text, application, chat or text message

Description automatically generated

Digital Broker 

A digital broker is an online insurance marketplace. They can pull quotes for you from their partners. CoverWallet, for example, partners with Chubb which doesn’t offer online quotes on its own website. On the other hand, CoverWallet will not give you a quote from anyone they are not partnered with. Digital brokers do make it very easy to comparison shop, however. 

  • CoverWallet
  • Commercialinsurance.net
  • Huckleberry

Here is a quote from CoverWallet for an accounting firm with 2 full-time employees and $400,000 annual revenue in Houston, Texas.

Graphical user interface, application, website

Description automatically generated

Learn more at the best general liability insurance companies in Texas.

General liability insurance requirements in Texas

Texas doesn’t have any general liability insurance requirements, which probably doesn’t surprise you if you live in Texas. Texas doesn’t even require workers’ compensation insurance, unlike every other state in the union. 

However, just because it’s not required doesn’t mean it’s a good idea to go without it. Any business can be sued for bodily injury or third-party property damage. And according to the website Lawshucks.com copyright infringement is the second most common reason a small business gets sued (the first is hiring discrimination), with property accidents being the 5th most common reason. 

Texas, all by itself, ranks as the 9th largest economy in the world. It’s good to be a small business owner in Texas. 

What does Texas general liability insurance cover?

General liability is one of the most essential types of insurance any small business needs. General liability insurance covers:

Third-party bodily injury

If one of your customers trips over some of your equipment and breaks a wrist, general liability insurance will cover their medical costs. It will also cover your court costs if they decide to sue you. Note that “third-party” refers to customers, clients, or vendors. It doesn’t cover you or your employees. 

Third-party property damage

If your work involves going into a client’s home, such as a contractor, there’s always a risk of accidentally damaging your customer’s property. Maybe you turn around and knock their expensive vase off the table. Maybe when you’re taking down a wall, you gouge a hole in the floor. General liability insurance will pay for repairs or the replacement costs of the damaged property. 

Reputational harm

This is usually seen as negative press or saying something bad about a company that causes the company to lose business. Usually, it has to be stated in the media: talking to your friends or family about a bad experience with a company is fine. But pretend a business rival is being interviewed. He says your company is being investigated for fraud. This is not true, and you would have a case against him. 

Advertising injury

This protects you against claims of stolen ideas, invasion of privacy, libel, slander, and copyright infringement. An example would be if you own a café’ and your latest ad has a picture of a customer in the background. You didn’t obtain her permission to be in the ad and she sues you. 

An important caveat to advertising injury coverage is that false advertising is not covered. If you advertise a new VPN for a price of $5.99 a month and when people go to your website, they discover that the price is actually $9.99 a month, general liability insurance won’t help you. 

Last Thoughts

General liability insurance is the most important type of business insurance you can buy. It’s often said that if you only get one type of insurance, it should be general liability.

Thang Truong

Thang Truong covers small business insurance and small business success at BravoPolicy. He is a licensed P&C insurance agent. Previously, he held product leadership positions at realtor.com, Capital One, NerdWallet, and Mulberry Technology. He holds a MBA degree from UC Berkeley - Haas School of Business.

More Stories

9 Best General Liability Insurance Companies for 2024

General liability insurance is probably the most popular business insurance that almost all businesses should have. It is required for some professions such as construction. The good news is that many insurance companies offer this product, so it is easy to find one that is the best for your business. In our intensive research, here […]

9 Best Commercial Auto Insurance Companies & Quotes in 2024

If you use your vehicles for work, you need to get a commercial auto insurance policy. Your personal auto insurance policy won’t cover the vehicles when you use for business. Commercial auto insurance is necessary when cars, trucks, or vans are used to conduct business. We cover everything you need to know about commercial auto […]

The 5 Best Business Owners Policy (BOP) Insurance for 2024

A Business Owner’s Policy (or BOP Insurance) is important to any small business to cover potential damages and losses when unexpected events happen. A BOP policy includes the coverages of general liability, commercial property, and business interruption in one master policy. If a small business can only afford one insurance policy, it should be a […]

11 Best Professional Liability Insurance Companies for 2024

If you’re a small business and in the market for professional liability insurance, below are 11 best companies offering this type of insurance for small businesses. In order to get an idea of the prices where online quotes were offered, we looked at a hypothetical accounting business in Wisconsin that had been in business for […]

Milepost Joins Truckstop: A New Dawn for Commercial Truck Insurance

The trucking industry is about to witness a significant shift in how insurance policies are procured, managed, and serviced. Milepost Insurance Agency LLC, a renowned Berkshire Hathaway enterprise, has recently collaborated with Truckstop, thereby pioneering a new era in trucking insurance for independent owner-operators. Revolutionizing the Insurance Experience The primary aim behind this dynamic partnership […]

Navigating Commercial Truck Insurance Premiums in 2023

Commercial truck insurance has become a focal point for many in the transportation sector as we delve deeper into 2023. With premiums seeing significant spikes in recent years, stakeholders are asking: Are we approaching a stabilization or even a decrease in these rates? Insights from industry experts provide clarity on this critical concern. Trends in […]

Regulatory Changes and Rising Commercial Truck Insurance Costs in California

In the wake of the passing of California’s AB5 bill, the trucking industry, including drivers and insurers, face unforeseen challenges. The legislation threatens to severely disrupt contractual trucking gigs, leading to rising insurance costs and potential operational changes. AB5 – A Potential Setback for Owner-Operators AB5, signed into law by Governor Gavin Newsom in 2019, […]

Finding Balance in Commercial Truck Insurance: Costs, Value, Services, and Long-Term Benefits

Navigating the maze of truck insurance offerings is not just a matter of finding the lowest price. It’s about understanding the nuances of what you’re buying, considering long-term benefits, and ensuring a harmonious relationship with your provider. This article offers a detailed examination of the process, unfolding the aspects of costs, value, services, honesty, and […]

New SEC Regulations on Cybersecurity and AI: A Comprehensive Overview

In an era where technology is at the forefront of business operations, the U.S. Securities and Exchange Commission (SEC) is taking decisive steps to ensure transparency and ethical practices. On Wednesday, the SEC was set to introduce new regulations that will impact publicly traded companies in two significant areas: cybersecurity and artificial intelligence (AI). These […]

6 Best Malpractice Insurance for Nurse Practitioners for 2023

Nurse practitioners have a great deal of responsibility when it comes to patient care. Many nurse practitioners assume that because they work under a doctor and their employer provides some level of malpractice insurance, they’re covered. It may be worth it to purchase your own policy, however. Employer malpractice insurance is to protect the employer, […]