Cleaning business insurance are policies that cover the risks associated with your business and protect your assets and equipment. The price depends on your business, but cleaning business insurance costs vary from $500 to $4,500 per year for general liability.
Estimated Cleaning Business Insurance Costs
Insurance Type | Annual Estimated Premium | Coverage Amount |
|---|---|---|
General Liability | $500 to $4,500 | $1 million occurrence limit; $2 million aggregate limit |
Commercial Property | $400 to $1,500 | $5,000 to $10,000 |
Commercial Auto | $1,900 to $4,400 | $500,000 combined single liability limit |
Workers’ Compensation | $5,000 to $6,800 | $100,000 bodily injury (per accident); $500,000 bodily injury policy limit; $100,000 bodily injury disease (per employee) |
Business Owner’s Policy (BOP) | $2,300 to $5,100 | $1 million occurrence limit; $2 million aggregate limit; $15,000 in property |
When evaluating your company, insurers will take some of the following factors into consideration:
- Claims history: Having a claim in the past three to five years will impact your premium.
- Employees: How many employees work for you? The answer will influence the liability and the workers’ compensation.
- Location: Where do you work? How many miles do you drive, and do you clean out of state?
- Limits: The higher the limit typically translates into a higher premium.
- Type of work: Are you a residential or commercial cleaner? Does your job involve water and mold remediation?
- Commercial risks: Do you clean a business open 24 hours or a hospital or school? What steps do you take to mitigate risk when cleaning?
- Hazardous waste: Cleaning usually involves chemicals, so what are you doing with any hazardous waste or chemicals you handle?
Be prepared to answer questions like these and more when applying for insurance for your cleaning business. While framing your answers to minimize the premium can be tempting, it is important to be honest. Lying on an insurance application can be interpreted as material misrepresentation, which is usually a coverage exclusion. And while lower limits may mean lower premiums, it is usually not a big difference. The risk of being underinsured isn’t worth the savings.
Types of Cleaning Business Coverage
Cleaning business insurance isn’t a specific type of policy you purchase. Like all business insurance, it combines different policies with coverage tailored to your business needs.
Most Common Policy Types | What it Covers |
|---|---|
General Liability | Third-party claims for bodily injury or property damage |
Commercial Property | Damage to your physical property, like building, furniture, and equipment |
Commercial Auto | Injuries, property damage, and lawsuits arising from auto accidents involving business-owned vehicles |
Workers’ Compensation | Employees’ medical bills and wages following a work-related illness or injury |
General Liability Insurance
General liability insurance should be standard for every business. It protects your company when a third party suffers an injury, property damage, or reputation harm as a result of your business operations. Costs associated with those claims, such as medical bills or replacement of damaged property, also fall under this coverage. Due to the use of chemicals and water, cleaning is an inherently risky business, so this is essential.
Let’s say a customer slips and falls on the floor you are mopping, or a child at a daycare gets sick from the smell of bleach. Both of these are situations where you may need to file a liability claim.
Some vendors will want to see proof that you have insurance before hiring you. The insurance they are interested in is general liability. Bringing a certificate of liability (COI) with you to a meeting will show the vendor you are a responsible business.
General liability is an essential coverage for small businesses, but that doesn’t mean you have to overpay for it. If you’re looking to save money on general liability, check out our guide to the cheapest general liability insurance companies.
Commercial Property Insurance
While liability protects your assets by handling the bills for someone else’s property, commercial property covers your physical property, such as your building, contents, and equipment. If you lease a space, you can still purchase property insurance with lower limits for your equipment.
Policies will usually cover your property either at actual cash value or replacement cost. Actual cash value pays what the property is worth on the market minus depreciation, while replacement cost pays what it would cost you to replace the damaged item.
Did you know? Insurance companies will usually offer a combination of liability and property in a BOP. There are several advantages to bundling these two together: it usually saves you money, and all of your policy information is in one place.
Commercial Auto
You will need commercial auto insurance if your business has a dedicated vehicle or vehicles. Personal auto doesn’t necessarily exclude driving to a cleaning site for work, so review your policy with your agent. Whether personal or commercial, auto insurance covers property damage and injury costs and, depending on the coverage, legal fees.
Liability is a state requirement if you purchase auto insurance. Also, some states require uninsured motorists and medical payments. The lending institution will require you to carry collision and comprehensive coverage if you own or lease the vehicle.
Workers’ Compensation
Nearly every state requires employers with an employee to carry some form of workers’ compensation insurance. This coverage helps employees who suffer work-related illnesses or injuries by helping with medical bills and lost wages. As a cleaning business, some examples can include an employee injuring their lower back or developing a rash from cleaning chemicals.
Other Coverages to Consider
While those are the four core coverages, there are additional options for your cleaning business. These are inland marine, commercial umbrella, and a surety bond.
Inland Marine
While you can schedule items on a property policy, depending upon the available coverage, you may need to consider an inland marine policy. This is a first-party property policy where you can schedule specific equipment and tools on the policy. Coverage is not limited to a location but rather follows the listed item.
Commercial Umbrella
An umbrella policy gives you additional limits for your liability insurance. If your liability policy is $500,000 but the cost of the claim exceeds that, you may be in a position to have to pay out of pocket. A commercial umbrella can help cover costs over your limits.
Surety Bond
Also known as a janitorial bond, this is an agreement stating the surety will pay the client (third party) if something goes wrong, and it is outlined in the terms of the bond agreement. Unlike insurance, surety bonds do not protect your business from liability claims. Usually, the money paid out is expected to be paid back by your company.
For example, your business may agree with a daycare center that it will clean the center every night after it closes and be finished and out of the building at least one hour before its opening. These terms are outlined in a surety bond, and if you fail to comply with them, then the daycare center can file a claim on the bond. Bonds may be necessary depending on licenses or if the vendor requests one.
Frequently Asked Questions (FAQs)
Workers’ comp is usually the only required business insurance. However, you should check with your state to see what is specifically required. Some vendors may also require you to carry insurance, or if you have a business loan, the lender may require coverage.
Liability policies cover three categories of negligence: bodily injury, property damage, and reputational harm. If something happens and a claim is filed, the insurance company will investigate if your business is legally liable for the injury, damage, or allegations of reputational harm. If it is determined liable, your carrier will proceed to handle the claim and attempt to do so within the limits of your policy.
Many factors go into determining the premium. A liability policy can range from $500 to $4,500. A commercial property policy may run from $400 to $1,500, while a commercial auto policy may cost anywhere from $1,900 to $4,400.
You can do so through a local agent or a broker. Many insurance carriers will also work with you directly, and you can reach out to them to purchase insurance. If you’re ready to buy, we’ve put together a guide of the best cleaning business insurance companies.
The first step when starting a cleaning business is to decide if it will be primarily focused on residential or commercial cleaning. The next step is to write a business plan and then begin to gather funding. Then, you will need to file legal paperwork, get proper licenses and insurance, and purchase cleaning equipment. If you need step-by-step guidance, see our article on how to start a cleaning business.
Bottom Line
You may be just starting as the owner and operator of a residential cleaning service or running an established large industrial cleaning business. Either way, you still want to consider insurance. Having the right coverage is essential for protecting your business and your assets against claims of negligence or natural disasters.
Due to the wide range of policies you may need, finding the right coverage is easier when you have an experienced provider to walk with you. The Hartford can provide you with a no-obligation quote in minutes and has experts to advise you on the right insurance. Get a quick quote today.
