What Type of Commercial Insurance Do I Need for My Business in California?

Introduction

Running a business in California comes with exciting opportunities—but also serious risks. Whether you're a small startup in Los Angeles, a contractor in San Diego, or a retailer in Fresno, the reality is that one lawsuit, accident, or disaster could wipe out everything you’ve built if you’re not properly insured.

But here's the tricky part: there isn’t just one type of commercial insurance. And not every policy fits every business.

This guide answers a question we hear every day at eWay Insurance:
“What type of commercial insurance do I need for my business in California?”

We’ll break down the most important coverages, show you what’s required by law, and help you understand what policies make sense for your specific industry. And if you’re not sure where to start—don’t worry. eWay Insurance shops 80+ carriers to find the right plan at the right price, customized to your business.

What Is Commercial Insurance?

Commercial insurance is a broad term for policies that protect your business from unexpected financial losses—such as lawsuits, property damage, data breaches, or employee injuries.

There’s no one-size-fits-all policy. Most California businesses need a mix of coverages, depending on the work they do, where they operate, and what legal or contractual obligations they must meet.

Essential Commercial Insurance Coverages in California

Here are the most common types of commercial insurance, along with who needs them and why:

1. General Liability Insurance

What it covers:

• Third-party injuries (e.g., a customer slips and falls)
  
  
• Property damage to others (e.g., you break a client’s window)
  
  
• Advertising or personal injury (e.g., libel, slander, copyright issues)
  

Who needs it:
Every business that interacts with the public, operates on someone else’s property, or leases commercial space.

California note:
Not legally required, but often mandatory for leases, vendor contracts, and permits.

eWay Insurance can help you bundle general liability with other coverages to reduce costs.

2. Commercial Property Insurance

What it covers:

• Damage to buildings, inventory, tools, and business equipment
  
  
• Fire, theft, vandalism, and some weather-related events
  

Who needs it:
Brick-and-mortar businesses, retail stores, warehouses, and home-based businesses with valuable equipment or inventory.

If you rent or own a physical location in California, this is a must-have to recover from disasters.

3. Business Owners Policy (BOP)

What it covers:

• Bundles general liability + commercial property
  
  
• Often includes business interruption coverage
  

Who needs it:
Small to mid-sized businesses looking for affordable, all-in-one protection. Ideal for retailers, restaurants, and offices.

eWay Insurance customizes BOPs for your risk level and can include add-ons like cyber or professional liability.

4. Workers’ Compensation Insurance

What it covers:

• Medical bills and lost wages for employees injured on the job
  
  
• Legal defense for workplace injury lawsuits
  

Who needs it:
Required by California law if you have even one employee, part-time or full-time.

Penalties for non-compliance can reach $100,000+ in fines and stop-work orders. eWay helps small employers meet these requirements affordably.

5. Commercial Auto Insurance

What it covers:

• Accidents involving vehicles used for business
  
  
• Liability for injuries and damages to others
  
  
• Vehicle repairs or replacement
  

Who needs it:
Any business that uses vehicles for work—whether owned by the company or personal cars used for deliveries or service calls.

In California, personal auto policies do not cover business use. eWay can help you set up a compliant policy that protects your drivers and assets.

6. Professional Liability Insurance (E&O)

What it covers:

• Claims of negligence, mistakes, or failure to deliver professional services
  
  
• Legal fees, court costs, and settlements
  

Who needs it:
Consultants, real estate agents, designers, accountants, therapists, and anyone who provides advice or services.

In California’s litigious environment, even unfounded claims can cost thousands. A solid E&O policy is your best defense.

7. Cyber Liability Insurance

What it covers:

• Data breaches, hacks, ransomware attacks
  
  
• Notification costs, credit monitoring, legal defense
  

Who needs it:
Any business that collects or stores customer data—especially medical, financial, or personal info.

California has some of the strictest data protection laws in the U.S., making cyber insurance a smart move for compliance and peace of mind.

What Coverage Does Your California Business Need?

Here’s a simplified breakdown by industry:

• Retail / Restaurants → General liability, property, BOP, workers’ comp
  
  
• Contractors / Trades → General liability, commercial auto, workers’ comp
  
  
• Consultants / Creatives → Professional liability, cyber liability, general liability
  
  
• E-commerce / Home-Based → BOP, cyber liability, product liability
  
  
• Real Estate / Legal / Accounting → E&O, general liability, cyber
  

Not sure what your business needs? eWay Insurance helps you figure it out—without overpaying or missing critical protection.

How Much Does Commercial Insurance Cost in California?

Costs vary widely depending on:

• Business type and industry
  
  
• Number of employees
  
  
• Location (especially high-risk zip codes in LA and the Bay Area)
  
  
• Revenue and claims history
  

Typical price ranges:

• General liability: $400–$1,200/year
  
  
• BOP: $600–$2,000/year
  
  
• Workers’ comp: $1.50–$3.00 per $100 of payroll
  
  
• Professional liability: $600–$1,500/year
  

eWay Insurance compares over 80 top-rated carriers to find you the best price with the coverage you actually need—nothing more, nothing less.

Why Choose eWay Insurance?

eWay is California-owned and operated, meaning we know the rules, requirements, and risks that affect local businesses. Here's what makes us different:

• One-on-one support from licensed agents (no chatbots or overseas call centers)
  
  
• Custom quotes within minutes—no fluff, no pressure
  
  
• Access to exclusive carriers and programs not available on national sites
  
  
• Annual policy reviews to keep up with your growth and reduce costs
  
  
• Bilingual team (English & Spanish) for inclusive service in LA and beyond
  

We make it easy for you to focus on your business—not your insurance paperwork.

Frequently Asked Questions

1. Is commercial insurance legally required in California?
Some types are—like workers’ comp for employees and commercial auto for business-use vehicles. Others may be contractually required or strongly recommended.

2. What’s the minimum I should carry for general liability?
Most businesses should have at least $1 million per occurrence and $2 million aggregate. eWay helps tailor these limits to your risk level.

3. Can I get insured if I work from home?
Yes. Many home-based businesses need general liability, property, and even cyber insurance. Homeowners policies usually don’t cover business activities.

4. Do I need more than one policy?
Often yes—but bundling (e.g., a BOP) can simplify coverage and reduce premiums.

5. How quickly can I get coverage through eWay?
Most businesses can get a quote within an hour and activate coverage the same day.

6. Can I switch from another provider mid-policy?
Yes. eWay helps with cancellations, refunds, and transitions to avoid gaps in coverage.

Final Thoughts

Every California business—big or small—faces risks that can’t be ignored. The good news? With the right commercial insurance in place, you can protect your assets, satisfy legal requirements, and operate with peace of mind.

eWay Insurance is here to help. Whether you need a single policy or a complete coverage plan, we’ll walk you through the options, explain everything clearly, and get you protected—fast and affordably.