Insurance coverage limits

The maximum amount an insurance policy will pay out for a covered claim


What are insurance coverage limits?

Insurance coverage limits are like financial guardrails in the world of insurance. Coverage limits define the line between what your insurance company will cover and what you’re responsible for paying out of pocket.

When do businesses need to consider their insurance coverage limits?

You should assess your insurance limits based on your business’s specific risks. If your business has higher risks, you’ll need more coverage.

Different types of insurance have their coverage limits, including:

They can be expressed as a dollar amount, like $100,000, or as a limit per occurrence.

You can often choose coverage limits when you purchase a policy. Higher limits mean more protection but may come with higher premiums. Knowing your coverage limits is crucial; you may need to cover the remaining costs if a claim exceeds these limits.

What should you consider when deciding on insurance coverage limits for your business?

First, assess the nature of your business and its associated risks. For instance, if you run a high-risk business, you’d likely find the highest coverage limit to be a justifiable expense.

On the other hand, if your business has the financial strength to handle a significant claim without insurance, a policy with a lower limit might suffice.

Next, weigh the insurance cost against its benefits, ensuring it’s feasible for your financial situation. Review all your existing policies to avoid overlaps; combining coverages might offer both efficiency and cost savings.

Strike the right balance with NEXT

At NEXT, we know your business is unique and has specific needs. That’s why we offer affordable, custom business insurance. To get your tailored instant quote, simply answer a few questions online. Once you’ve purchased your insurance, you can immediately access your certificate of insurance and share it 24/7 via the NEXT app.

Start a free instant quote with NEXT.

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Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your business.
General Liability insurance
General Liability
Protect yourself from accidents that cause physical injury or damaged property.
Professional Liability or Error and Omissions Insurance
Professional Liability/E&O
Shield yourself from lawsuits that claim your work errors caused financial losses.
Workers' Compensation Insurance
Workers’ Compensation
Cover medical bills and lost wages if your employees have an accident at work.
Commercial Auto Insurance
Commercial Auto
Stay on the road with coverage for dents, tows and damage to someone else’s vehicle.
Tools & Equipment Insurance
Tools & Equipment
Upgrade your general liability coverage to protect any gear that’s stolen, damaged or lost.
Commercial Property Insurance
Commercial Property
Keep your building, inventory and equipment protected from fire or water damage.
Business Owner’s Policy Insurance
Business Owner’s Policy
Combine general liability and commercial property into one policy to protect your business.
* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
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Issuance of coverage is subject to underwriting. Not available in all states. Please see the policy for full terms, conditions and exclusions. Coverage examples are for illustrative purposes only. Your policy documents govern, terms and exclusions apply. Coverage is dependent on actual facts and circumstances giving rise to a claim. Next Insurance, Inc. and/or its affiliates is an insurance agency licensed to sell certain insurance products and may receive compensation from insurance companies for such sales. Policy obligations are the sole responsibility of the issuing insurance company. Refer to Legal Notices section for additional information.