Do Small Businesses in California Need General Liability Insurance? Here’s What to Know

Introduction

Running a small business in California is exciting—but it’s not without risks. From slip-and-fall accidents to property damage and customer complaints, unexpected incidents can turn into costly lawsuits. That’s where general liability insurance comes in.

If you’ve asked yourself, “Do I really need general liability insurance for my small business?”—you’re not alone. In this guide, we’ll break down exactly what it covers, when it’s required, and why it’s one of the most important investments you can make.

We’ll also show how eWay Insurance helps California small businesses get affordable, tailored coverage without the hassle.

What Is General Liability Insurance?

General liability insurance protects small businesses from the financial fallout of everyday accidents and legal claims. It typically covers:

• Bodily injury: A customer trips and gets hurt at your business location.
  
  
• Property damage: You or your employee accidentally damage a client’s property.
  
  
• Personal and advertising injury: Claims of slander, libel, or copyright infringement.
  
  
• Medical payments: Quick coverage for minor injuries that happen on-site.
  
  

It doesn’t cover:

• Employee injuries (that’s workers’ comp)
  
  
• Business property you own (that’s commercial property insurance)
  
  
• Professional mistakes (see professional liability)
  
  

Is It Required in California?

California law does not require general liability insurance to start a business. However, in practice, it’s often mandatory for:

• Signing commercial leases
  
  
• Getting business licenses or permits
  
  
• Working with government agencies
  
  
• Contracting with clients or vendors
  
  

And even if not required, going without it can leave your business exposed. A single lawsuit—even one you win—can cost thousands in legal fees.

Who Needs General Liability Insurance in California?

If your business interacts with the public, operates on someone else’s property, or provides physical products or services, general liability is a must.

Common small businesses that benefit from this coverage:

• Retail shops and storefronts
  
  
• Contractors, electricians, and landscapers
  
  
• Consultants and freelancers
  
  
• Food trucks and caterers
  
  
• Cleaning services
  
  
• Home-based businesses
  
  

Whether you work from a storefront, your home, or on the go—eWay Insurance can help you find a policy that fits your exact situation and budget.

Real Risks: Why It Matters in California

California is known for its strong consumer protection laws and high rate of lawsuits. Even unintentional damage or injury can result in a legal claim—and without insurance, you could be held personally liable.

Examples include:

• A customer slipping in your store
  
  
• Damage to a client’s home during a service call
  
  
• A negative Yelp review turning into a defamation dispute
  
  
• Sending a marketing email that unintentionally violates advertising laws
  
  

General liability insurance covers legal defense, settlements, and medical costs—saving you from paying out of pocket.

How Much Does It Cost for a Small Business?

Premiums for general liability insurance in California vary based on:

• Your industry
  
  
• Business size and location
  
  
• Annual revenue and payroll
  
  
• Claims history
  
  

Typical cost ranges:

• Freelancers/consultants: $300–$600 per year
  
  
• Tradespeople (e.g., HVAC, painting): $700–$1,500 per year
  
  
• Retail/small shops: $1,200–$2,500 per year
  
  

eWay Insurance compares 80+ insurers to find the best rates for your business type—often saving you hundreds.

Why Choose eWay Insurance?

Unlike online-only platforms or one-size-fits-all brokers, eWay Insurance specializes in helping California businesses:

• Understand what coverage is actually needed
  
  
• Avoid overpaying for unnecessary extras
  
  
• Get fast, personalized quotes—same day in many cases
  
  
• Access bilingual support (English & Spanish)
  
  
• Receive annual policy reviews and compliance assistance
  
  

Whether you’re a new business owner or ready to upgrade your current policy, eWay makes it easy.

Frequently Asked Questions

1. Is general liability required for LLCs in California?
No, but many clients and landlords require it—regardless of your structure.

2. Can I bundle general liability with other policies?
Yes. eWay offers Business Owners Policies (BOP) that bundle liability, property, and business interruption coverage—often at a lower rate.

3. Will I need it if I work from home?
Yes, if clients visit you or you work on client property. Homeowners insurance usually doesn’t cover business liability.

4. What’s the minimum coverage I need?
Most businesses should carry at least $1 million per occurrence, with $2 million aggregate. eWay helps you decide based on risk.

5. How fast can I get covered?
With eWay, you can often get same-day quotes and bind coverage within 24 hours.

6. Does eWay provide proof of insurance (COI)?
Yes—eWay provides instant Certificates of Insurance so you can meet contract or lease requirements.

Final Thoughts

You don’t need to be a big business to face big risks. For California small business owners, general liability insurance offers critical protection against the most common—and costly—legal threats.

eWay Insurance is your go-to partner for affordable, customized coverage that keeps your business protected and compliant. Whether you’re just starting out or growing fast, they make insurance simple, local, and stress-free.

Check out our free quoting tool or call (323) 749‑5400 to get your free quote today.