How Much Does Commercial Property Insurance Cost?

Our customers pay an average of $1,677 annually, or abour $140 a month, for commercial property insurance.1 Insurers can use several factors to determine your price, so your cost may be different than the average.
Author:
Chloe Silverman
Chloe Silverman,Staff Copywriter
Chloe Silverman
Staff copywriter specializing in small business insurance for The Hartford.
Reviewed By:
Gene Marks
Gene Marks,CPA, Keynote Speaker, National Business Columnist and Author
Gene Marks
CPA, keynote speaker, national business columnist and author.
LinkedIn Profile
Updated: 08/23/2024
Read Time: 3 minutes
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Key Takeaways

  • Our customers in Colorado had the lowest average cost: $670 a year or about $56 a month.2
  • Some of the factors that can affect your cost are your location, materials used to construct your building, occupancy and any fire safety and security protections included.
  • You can save money on your commercial property insurance costs through bundling, paying the annual premium, managing risks or choose a higher deductible.

What Factors Affect the Cost of Commercial Property Insurance?

Insurance companies use several different factors to determine what you pay for commercial property insurance. Your cost for commercial property insurance may be impacted by the following:

Location

If your business is located in a populated area that has higher risk for crime or vandalism, you may pay a higher rate.

Construction

For example, buildings made from fire-resistant materials will typically cost less to insure because of these precautions.

Occupancy

Businesses with larger amounts of people consistently on the premises, like restaurants, will likely pay higher insurance costs.

Fire and Threat Protection

Installing safety features at your business, like smoke detectors and burglar alarms, may help lower your rate.

How Does My Industry Affect My Commercial Property Insurance Cost?

Your type of industry can be one of the biggest factors that impact the cost of commercial property insurance. If your business’ operations are more hazardous, you’ll need safety features, which can lead to higher insurance costs. For example, a manufacturing company is likely to be exposed to more risks than a technology consultant who works from their home office. To help lower property insurance rates, your business can install safety features like smoke detectors and sprinkler systems.
 
Regardless of your industry, most small businesses can benefit from having different . With this coverage, your owned or rented building, plus the tools and equipment inside it, will be protected from property damage resulting from fire, natural disasters, theft and other covered events.
 

What Does Commercial Property Insurance Cost in My State?

Commercial property insurance costs vary by state. That's because where your business is located is another factor that can impact your rate. If your business is in an area that experiences natural disasters or severe weather more often than other areas, you may see higher costs for coverage. The best way to find out your business' commercial property insurance cost is to get a quote.
small business owner enjoying their job knowing they have great commercial property insurance rates

How To Save on Commercial Building Insurance Costs

Commercial property insurance premiums often vary because every business is unique, but there are steps you can take to try to save on costs. Your business can install safety systems to help protect against property damage caused by wind or lightning storms, which may help bring your insurance costs down while still protecting your property. Other ways you may be able to save on your insurance include:
 
  • Bundling your policies
  • Paying your premium annually
  • Managing your risks
  • Choosing a higher deductible
Important:
If you choose a higher deductible, this means you'll have more out-of-pocket costs for a claim. If you choose a lower deductible, you'll have less of an out-of-pocket expense, but your insurance policy will likely cost more.

Common Questions About Commercial Property Insurance Cost

On average, our customers pay $1,605 annually, or about $134 a month, for commercial property insurance with The Hartford.3 Keep in mind that your insurance costs may be higher or lower because insurance companies depend on several different factors to determine premium.
Insurance companies use several different factors to determine the cost of your commercial property insurance, like your business’ location, industry, coverage limits, claims history and number of employees. Some industries face higher risks than other industries due to the nature of their work and the risks they face during normal business operations.
A commercial property insurance premium is what you pay for insurance coverage either monthly or annually. If you choose to pay your premium annually, you may be able to save on insurance costs. Your insurance premium is specific to your business needs. So, if you need additional insurance coverages in addition to your commercial property insurance, you may be able to save money by bundling your policies.

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1,2 Premium amounts presented are based on monthly premium paid by The Hartford's Small Business customers between 6/1/23 and 6/1/24 for 12-month policies. Lowest average state cost based on states with at least 10 policies. Premium is derived from a number of factors specific to your business and may vary.
 
Additional disclosures below.
The Hartford shall not be liable for any damages in connection with the use of any information provided on this page. Please consult with your insurance agent/broker or insurance company to determine specific coverage needs as this information is intended to be educational in nature.
 
The information contained on this page should not be construed as specific legal, HR, financial, or insurance advice and is not a guarantee of coverage. In the event of a loss or claim, coverage determinations will be subject to the policy language, and any potential claim payment will be determined following a claim investigation.
 
Certain coverages vary by state and may not be available to all businesses. All Hartford coverages and services described on this page may be offered by one or more of the property and casualty insurance company subsidiaries of The Hartford Financial Services Group, Inc. listed in the Legal Notice.
 
The Hartford Financial Services Group, Inc., (NYSE: HIG) operates through its subsidiaries under the brand name, The Hartford, and is headquartered in Hartford, CT. For additional details, please read The Hartford’s Legal Notice.
 
* Customer reviews are collected and tabulated by The Hartford and not representative of all customers.