The Most Common 10 Insurance Claims Made by Small Businesses

Insurance claims made by small businesses have a range of insurance claim options available to cover expenses resulting from accidents or disasters.

It’s essential for small business owners to understand these claim types and the filing process. A study by the Hartford revealed that over 40 percent of small businesses will likely need to file an insurance claim within the next decade.

Learning about these claim variations and the most efficient filing methods can potentially save both time and money when facing a covered financial loss under your commercial insurance policy.

What Are Claims in Insurance?

Insurance claims refer to formal requests made to insurance companies seeking compensation for losses covered by a business’s insurance policy.

Whenever you need reimbursement for a financial loss resulting from damage or covered accidents, it’s essential to file an insurance claim.

Following the claim submission, an insurance adjuster will investigate the case. If it’s considered valid and falls within your coverage, your business will receive a payment to offset its losses.

Types of Insurance Claims

Various types of insurance claims might be necessary for companies to recover expenses linked to accidents and disasters.

The following are the primary types of insurance claims frequently filed by insured small businesses:

1. Burglary and Theft

Burglary and theft stand as the prevailing commercial insurance claims lodged by businesses, particularly prevalent in the retail, construction, and manufacturing sectors.

These incidents encompass damage to company property resulting from break-ins and the actual theft of belongings and equipment.

A commercial property insurance policy can assist in covering the expenses linked to burglary and theft.

2. Water and Freezing Damage

The second most frequent type of insurance claim submitted by companies involves water-related damages. These damages encompass burst pipes or flooding caused by storms.

Such claims are more prevalent in coastal regions and low-lying areas susceptible to flooding. Commercial property insurance can help offset the expenses incurred due to such damage, covering costs for repairing structural damage, replacing waterlogged carpets, and addressing mold removal.

3. Wind and Hail Damage

Severe storms have the potential to cause trees and branches to fall onto buildings, hail can cause damage to windows and roofs, and hurricanes or tornadoes can devastate commercial structures entirely.

Claims for wind and hail damage rank as the third most frequent among commercial insurance claims, especially in regions highly susceptible to intense storms.

A commercial property insurance policy can assist in offsetting the expenses related to damage caused by various types of wind storms.

4. Slips and Falls by Customers

Customers slipping and falling on your business premises represent a common insurance claim, as your company might bear responsibility for covering medical costs, legal fees, and lost wages resulting from such incidents.

Retail stores and restaurants most commonly file these types of insurance claims. Your general liability insurance policy is designed to protect your business from financial losses stemming from customer slips or falls on your commercial property.

5. Product Liability

If a product you produce or sell is defective, you might be accountable for any resulting injuries or illnesses suffered by customers.

This type of insurance claim is prevalent in the retail, manufacturing, and distribution sectors. Without adequate insurance coverage, your business could face liability for medical costs, lost wages, legal fees, and expenses related to product recalls.

General liability insurance and product liability insurance policies offer support for your business to manage the risks linked to product liability.

6. Struck by an Object

Insurance claims for being struck by an object involve workplace incidents where an employee is hit by equipment or another object, leading to either fatal or non-fatal accidents.

These types of claims are frequent in the construction, manufacturing, agriculture, and forestry sectors. Workers’ compensation can address the employee’s lost wages and medical expenses resulting from the accident.

In the event of a workplace fatality, the employee’s family or dependents receive benefits through workers’ compensation. In many states, it’s mandatory for businesses to obtain workers’ compensation insurance.

7. Reputational Harm

A reputational harm claim becomes necessary when an individual or another business files a lawsuit against your company, alleging that it caused them reputational damage.

This can occur due to events such as a data breach affecting your own business’s reputation negatively. Such claims are prevalent among media organizations and businesses that store customer data, such as retail stores and financial institutions.

General liability and professional liability insurance policies offer protection for your business against these risks.

8. Auto Accident

Collisions involving commercial vehicles often lead to insurance claims due to vehicle damage, property damage, or injuries.

Businesses that utilize commercial vehicles face the risk of such accidents, but a commercial auto insurance policy can safeguard your business, the commercial vehicles, and any employees who operate company cars, trucks, or vans.

9. Fire

Fire poses a significant threat to small businesses and remains a prevalent type of insurance claim across various industries, such as manufacturing and restaurants.

You can initiate commercial property insurance claims to offset financial losses resulting from fires, encompassing repairs or reconstruction of buildings, and replacing damaged equipment and supplies.

Additionally, with business income insurance, you can file a claim under the policy to compensate for the income lost during the cessation of business operations due to fire damage.

10. Customer Injury and Property Damage

Your general liability insurance policy can provide coverage for accidents causing personal injury to a customer or damage to someone’s property.

These types of insurance claims are widespread across various industries like construction, landscaping, and retail businesses.

Such accidents encompass scenarios where an employee trips and falls while on duty or when a work vehicle collides with a building, resulting in damage. General liability insurance aids in covering the associated costs of medical expenses, repairs, and legal fees.


Small businesses frequently navigate various insurance claims to mitigate losses from diverse incidents like theft, property damage, and customer accidents.

These claims, encompassing liability, property, and injury-related cases, address challenges from natural disasters to operational mishaps.

Understanding and effectively managing these claims, aided by tailored insurance policies, are crucial for financial resilience. With insights into prevalent claim types and procedural know-how, businesses can better protect themselves.

Timely, accurate claim filings, supported by thorough documentation, ensure swift resolution, enabling small businesses to recover and sustain operations amidst unforeseen adversities.


1. What are the common types of insurance claims filed by small businesses?

Small businesses often file claims related to property damage, theft, customer accidents, product liability, and natural disasters.

2. How can small businesses ensure a smoother insurance claim process?

Maintaining detailed records, promptly reporting incidents, understanding policy coverage, and seeking guidance from insurance agents facilitate smoother claim processing.

3. Is it necessary for small businesses to have insurance coverage for various claim types?

Yes, having appropriate insurance coverage tailored to potential risks is vital. It helps protect against financial losses arising from unforeseen events.

4. What steps should small businesses take when filing an insurance claim?

Small businesses should document incidents, notify insurers promptly, provide accurate information, and cooperate fully during the claims investigation.

5. How does filing insurance claims benefit small businesses?

Filing valid insurance claims aids in recovering losses, ensuring financial stability, and supporting business continuity during challenging times.

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