Kentucky Business Insurance

There are more than 350,000 small businesses and self-employed professionals in Kentucky, and they account for almost all companies based in the state.¹

No matter your company’s industry, business insurance in Kentucky is crucial because it helps protect against events that can negatively impact your bottom line, including:

• Claims of causing an injury or property damage
• Employees getting hurt at work
• Business-related auto accidents
• Accusations of work mistakes and negligence

Next Insurance helps more than 1,000 types of small businesses and self-employed workers quickly get the coverage they need online at the best price. We specialize in small business insurance, so we can easily help you find a custom insurance package that is right for you.

Continue reading to find out about the most important types of business insurance in Kentucky or start a free instant quote to review options for your business.

We offer a quick and simple way for you to get business insurance quotes online, purchase coverage and share your certificate of insurance. The entire process typically takes just a few minutes.

Our team of licensed, U.S.-based advisors can help you if you have any questions.

Start an instant quote today.

Small business insurance in Kentucky usually includes some combination of the following policies:

• General liability insurance, which helps cover damages from claims of injury and property damage.
• Professional liability insurance, which helps pay for damages and lawsuit costs if a client accuses you of work negligence.
• Workers’ compensation insurance to help employees who get hurt on the job pay for medical bills and recoup some lost wages.
• Commercial auto insurance to help pay for damages from accidents that occur in business-owned vehicles.

General Liability insurance

Next recommends that most business insurance bundles in Kentucky include general liability coverage.

General liability insurance helps cover the costs of accidents, including accusations of injury and property damage, so you don’t have to settle an expensive claim entirely out of pocket.

For example, a visitor to an office building in downtown Louisville has a slip-and-fall injury on a wet floor and needs emergency care. The injured person claims that employees of a cleaning company are at fault for the accident because they failed to post the proper warning signs.

The cleaning company’s general liability coverage helps pay for the visitor’s medical expenses. If the visitor decided to sue for additional damages, general liability insurance would offer assistance by helping the business pay for attorney fees, court costs and any settlements for which it was found responsible.

Note that if you plan to rent office space, many commercial landlords will require proof of general liability insurance before you sign a lease.

Cleaning and construction companies may want to add tools and equipment coverage to their general liability business insurance in Kentucky. This coverage upgrade helps pay to repair or replace essential business gear that is damaged, lost or stolen.

Professional Liability (E&O) insurance 

Even the most careful small business owners could be accused of professional negligence, including claims of work errors, incomplete projects or missed deadlines.

This is why business insurance in Kentucky often includes professional liability coverage. Also known as errors and omissions (E&O) insurance, this type of coverage helps companies pay for expenses associated with professional negligence claims.

E&O coverage would provide protection in the following scenario:

A commercial building developer in Lexington claims that employees of a local heating and ventilation firm made a mistake when installing the climate control system, which causes a project delay and financial losses.

Professional liability insurance would help the HVAC company reimburse the client for losses and pay for the costs to fix the problem. If the client sued for damages, E&O insurance also helps cover legal expenses such as court costs, attorney fees and any additional settlements.

Workers’ Compensation insurance

Kentucky state law requires business with employees to carry workers’ compensation insurance.² 

This type of coverage helps employees who suffer job-related injuries pay for medical expenses, including hospital bills and the costs of physical rehabilitation. It also covers a portion of lost wages while the injured employee can’t report to work.

For instance, an employee of an Owensboro-based painting company suffers a leg injury after falling off a ladder and is sidelined for a month. Workers’ comp coverage helps the injured employee cover medical expenses and replace some lost wages. 

In Kentucky, workers’ comp insurance reimburses the injured employee for 66% of weekly wages, up to state law maximums.³

Commercial Auto insurance

Kentucky requires all drivers in the state to carry auto insurance that covers a minimum of $60,000 in protection to help pay for injuries and vehicle and property damages in the event of an accident.⁴

Keep in mind that personal auto insurance probably won’t help pay for accident damages that happen if employees regularly drive for work. This is why businesses that own vehicles need commercial auto insurance. The more vehicles your company owns and the more often they’re on the road, the more coverage you should consider.

For example, two workers at a window-washing business in Bowling Green have an accident while returning from a job, resulting in thousands of dollars in damages to a company-owned van. Commercial auto insurance would help pay to fix the damages to the van up to the policy’s limits.

If the window washing company sometimes asked employees to drive their own cars for work or rent vehicles, it would want an commercial auto insurance add-on called hired and non-owned auto coverage to help pay for accident damages.

Businesses in major industries that Next serves spend a median of about $49 per month on business insurance in Kentucky.

No two small businesses are exactly alike, so how much you’ll pay for coverage depends on factors such as:

Risks your business frequently encounters. Industries that are regularly exposed to serious risks usually pay more for business insurance. 

For instance, small construction companies based in the Bluegrass State spend a median of $64 each month for business coverage because of the higher likelihood of injury or property damage. Management consulting firms don’t face the same types of risk and pay about $29 per month for business insurance in Kentucky.

How many employees you have. Workers’ compensation coverage costs are determined by a business’s number of employees, so larger companies should expect to pay more than smaller ones. Having an exact employee number will help make sure you quickly get the most accurate quote.

The types of coverage and policy limits you choose. It can be tempting to purchase the minimum required insurance and policy limits to save money in the short term. But if you have to file a claim, you might actually end up spending more out of pocket.

Start a quote with Next Insurance today to explore coverage options for your business in just a few minutes.

More resources for Kentucky small businesses and self-employed workers

Check out these links if you would like to learn more about starting a business in Kentucky:

• Kentucky Small Business Development Center
• Kentucky One Stop Business Portal
• Kentucky Department of Insurance

Article sources: 

1. U.S. Small Business Administration
2. Commonwealth of Kentucky Labor Cabinet 
3. FindLaw
4. Commonwealth of Kentucky