Small Business Insurance Ontario

Factors that may affect the cost of small business insurance in Ontario

According to a new Canadian Federation of Independent Business (CFIB) report, more than two-thirds (68%) of small businesses in Canada now list insurance costs as one of their biggest concerns. But how much does it actually cost?

The truth is that it varies from business to business. Every insurance company looks at risk a little differently, so your premium will depend on a few key details about your business. Here are some of the factors insurance companies may consider when determining your small business insurance premiums in Ontario:

The location of your business

If you’re situated in a large urban centre like Toronto or Ottawa, you’re likely to face higher premiums due to increased foot traffic, theft or vandalism risks, and broader legal exposure. Also, areas prone to severe weather events attract higher rates. In fact, the Insurance Bureau of Canada (IBC) reported that 2024 was the most expensive year in nearly a decade for weather-related commercial property losses, with insured damages topping $1.7 billion. Flash flooding in the GTA and Southern Ontario ranked fourth in total losses nationwide.

The type of business and industry

Businesses in industries with higher injury rates, stricter regulations, or greater potential for costly claims often see higher premiums. For example, a construction company with heavy equipment, on-site hazards, and large contracts will typically pay more than a home-based marketing agency.

The size and scope of your business

Are you a one-person powerhouse or leading a growing crew? The size of your business also affects what you’ll pay for insurance. More staff, more gear, and more revenue all mean there’s more at stake, so your coverage needs (and costs) usually go up to match them.

Your business assets

Do you own commercial property, business vehicles, staging gear, signage, or inspection tools? The more property or tools you are insuring (and the higher their replacement cost), the more it will cost to insure them.

Your claims history

Claim-free businesses are more attractive to insurance providers and often enjoy lower rates, whereas businesses that file frequent claims, even minor ones, signal higher risk and commonly face higher premiums.

The coverages, limits, and deductibles you choose

A basic policy might include property, general liability, and maybe commercial auto insurance. But when you add additional coverage, like cyber liability or product liability, or increase your coverage limits, it will usually increase your premium (though it also gives you greater protection when you need it most). You can offset some of that cost by choosing a higher deductible, but remember that this also means paying more out of pocket if you need to make a claim. To find out how much small business insurance would cost you, contact BrokerLink today.