Startup Business Insurance: What You Need, Best Options
Startups need a few types of insurance to protect their cash, board members, executives and customer data.
Many, or all, of the products featured on this page are from our advertising partners who compensate us when you take certain actions on our website or click to take an action on their website. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
Updated · 4 min read
Written by
Lead Writer & Content Strategist 
Edited by
Head of Content, Small Business 
Business insurance protects your startup in case you face a lawsuit, natural disaster or data breach. Most startups need several policies. Common types include:
- General liability insurance. This can cover your legal fees and settlement costs if your company is sued for causing injury or property damage.
- Workers’ comp. Most states require this coverage. Check your state’s rules here.
- Cyber insurance. This can pay out after you suffer a data breach.
- Directors and officers insurance. This coverage protects your board members and executives if someone names them in a lawsuit.
- Technology errors and omissions insurance. If your business sells software or does software consulting, this is a necessity. It can protect your company if it’s accused of making a mistake or doing shoddy work.
Save up to 30% on business insurance
NerdWallet Small Business helps you get real-time quotes from 30+ insurers, and instant access to your Certificate of Insurance (COI) through our partner, Coverdash.
Best insurance companies for startups
NerdWallet’s editorial team chooses the best business insurance companies based on:
- How many complaints policyholders make to state insurance regulators.
- How financially strong insurance companies are, according to credit rating agencies.
- How easy it is to get a quote and buy a policy online.
Here are some of our top-rated companies that serve startups. We also included several specialty companies that focus on high-growth startups. In general, the insurance industry has a reputation for moving slowly. It makes sense that some founders prefer insurance companies with sophisticated tech stacks and faster processes.
We recommend getting multiple quotes to find the best coverage at the best price.
Why trust NerdWallet
Chubb
Chubb is a major business insurance company that offers virtually every type of insurance. While your annual revenue is less than $2 million, you can buy general liability insurance, a business owner’s policy cyber insurance, workers’ comp and an umbrella policy online. An independent agent can help you get other types of coverage. Chubb is one of our top-rated insurers thanks to its financial strength and relatively low numbers of complaints from customers. Read review.
Travelers
Travelers is another longtime business insurance company. It sells insurance packages tailored to a variety of specific risks,like protection against global claims or product liability insurance for a pharmaceutical company.
Travelers is a good choice if you know you want to work with an agent — it doesn’t offer quotes or sell insurance online. Like Chubb, this company got high marks from NerdWallet thanks to relatively few complaints and high financial strength grades from credit rating agencies. Read review.
Vouch
We have not yet rated Vouch.
Founded in 2018, Vouch is an insuretech that sells insurance to tech and life sciences companies. Global insurer Hiscox agreed to acquire Vouch in August 2025. That deal is pending as of this writing.
Vouch lets you apply in a few minutes for common policies, like general liability, D&O, E&O, cyber insurance and employment practices liability insurance.
It also sells crime insurance, which protects you in cases of employee theft or fraud; fiduciary liability insurance, which protects you if you make a mistake in an employee benefit plans; and special policies for venture capitalists and companies using AI products.
Vouch underwrites some of its own policies but is also a broker, so may sell policies from other insurers. You’ll file claims through Vouch, too.
Founder Shield
Founder Shield is an insurance broker. Since it doesn't underwrite insurance policies, we don't give it a star rating.
Founder Shield is a division of The Baldwin Group, an insurance brokerage and risk management firm, that specializes in startups. You can use Founder Shield to get a quote and buy coverage online. The company sells common insurance policies along with coverage for products in transit, mergers and acquisitions liability, telemedicine liability and more.
We always recommend getting multiple business insurance quotes to find the best coverage at the best price. Since Founder Shield offers online quotes, getting one could give you a good sense of how much insurance will cost your company.
Save up to 30% on business insurance
NerdWallet Small Business helps you get real-time quotes from 30+ insurers, and instant access to your Certificate of Insurance (COI) through our partner, Coverdash.
What is startup business insurance?
As a startup, you’re responsible for two important resources: your investors’ money and your customers’ data. Insurance helps you protect both.
There’s no single insurance policy called “startup business insurance.” Instead, most startups need a few different insurance policies.
These can include several types of liability insurance, which protect your reserves if someone sues your company. Directors and officers insurance protects your executives and investors’ personal finances if they face liability risks. And data breach insurance can pay out if your network gets hacked.
What coverage do startups need?
Most startups should consider the following types of business insurance.
General liability insurance
General liability insurance protects you if a third party, like a customer or another business, accuses you of harming them or their property. It can also protect you against claims of libel, slander and reputational harm.
For example, say you run an ad implying that a competitor’s product has some flaws. That competitor sues your startup for defamation. General liability insurance could help cover your legal costs.
Business owner’s policy
A business owner’s policy, or BOP, includes general liability insurance along with two other types of coverage:
- Business property insurance, which covers the space you own or rent and your company’s equipment.
- Business interruption insurance, which can make up for the income you lose while your company can’t operate after a covered property insurance loss.
If you have an office, get a BOP instead of general liability insurance.
Cyber insurance
Cyber insurance can help your company deal with the costs of a hacker stealing your company’s data. It can cover the costs of notifying your customers about the breach, paying a ransom if necessary, settling a legal claim and more.
If your startup makes software, you may need tech E&O insurance, too. This specialized errors and omissions insurance policy can protect you if one of your customers claims your software for causing them a cybersecurity incident.
Workers’ compensation
Most states legally require companies to have workers’ comp. This insurance policy covers lost wages and medical costs when an employee gets injured on the job.
You have to have workers’ comp even if injuries seem unlikely — if most of your team works at desks, for instance. But typically lower-risk industries have lower premiums.
Employment practices liability insurance
Employment practices liability insurance (EPLI) can cover your legal defense if a current or former employee sues your company. That might include claims of discrimination, harassment, wrongful termination or breach of a contract.
The larger your team gets, the more important EPLI coverage is.
D&O insurance
Directors and officers insurance provides protection for your board members and high-level executives. If a legal claim against your company names them too, this insurance policy can pay out to cover their legal defense.
Your board might insist that you have D&O insurance. If not, it’s still a good idea once your company has multiple C-suite leaders.
Umbrella insurance
A business umbrella policy gives you extra liability protection. Most lawsuits should be covered by a different type of insurance — general liability, E&O, employment practices liability or otherwise. But sometimes, legal and settlement costs exceed those policies’ limits. That’s when your umbrella policy kicks in.
Consider umbrella insurance as your company’s reserves grow. A large legal claim might force a smaller company to enter bankruptcy proceedings. Larger companies potentially have more to lose. Insurance can help you handle a major settlement without losing your business.
How much does startup business insurance cost?
Here are median annual premium amounts for startups depending on their stage. These figures come from Coverdash, an online insurance brokerage, which shared insurance premium data with NerdWallet in 2026:
| Pre-seed | Seed stage | Series A | Series B | Series C+ | |
|---|---|---|---|---|---|
| Total premium costs | $5,200 per year | $14,500 per year | $48,500 per year | $78,000 per year | $140,000 or more per year |
| General liability insurance | $1,200 | $2,000 | $3,500 | $5,000 | $8,000 and up |
| Technology E&O or cyber insurance | $2,000 | $3,500 | $10,000 | $15,000 | $40,000 and up |
| Workers' comp | $2,000 | $3,000 | $7,000 | $10,000 | $15,000 and up |
| Employment practices liability insurance | $1,000 | $1,000 | $3,000 | $8,000 | $18,000 and up |
| D&O insurance | No data | $5,000 | $25,000 | $40,000 | $70,000 and up |
How to get startup business insurance
Follow these steps to shop for startup business insurance.
- Decide whether you want to work with an insurance agent. Some agents and brokers are experts in particular industries. A good one can help you understand your needs, compare different insurers and choose the best fit. Ask your investors if they recommend anyone.
- Understand what coverage you’re required to have. This includes legal requirements, like workers’ comp, and anything mentioned in your contracts. Investors might insist that you have D&O insurance, for instance.
- Get quotes. Get business insurance quotes from multiple companies to compare costs and coverage before choosing a policy. You can get a quote in a few minutes online or slightly longer over the phone. Your agent can also get quotes for you.
- Buy your policies. After you choose a policy, make sure you know how to make payments and file claims if necessary.
We typically recommend business owners revisit their insurance once a year. But a fast-growing startup might need to make more frequent changes. Talk to your insurance agent or one of your advisors every time you make an investment in growing your team, acquiring more customers or adding a line of business.
Article sources
NerdWallet writers are subject matter authorities who use primary,
trustworthy sources to inform their work, including peer-reviewed
studies, government websites, academic research and interviews with
industry experts. All content is fact-checked for accuracy, timeliness
and relevance. You can learn more about NerdWallet's high
standards for journalism by reading our
editorial guidelines.
On this page
