Top 10 Small-Business Insurance Claims

Small business insurance is one of the most important tools entrepreneurs have to protect their operations—but many business owners think of it as a safety net they’ll probably never need. Understanding the most common types of small business insurance claims can help you take proactive steps to reduce risk, prevent losses, and ensure your coverage is ready when you need it most.

Top 10 Small Business Insurance Claims (and How to Avoid Them)

1. Theft and Burglary: The top reason for small business insurance claims is burglary and theft. Some of these crimes are committed by outsiders. Others are the result of dishonest employee activity.

Prevention tips:

• Install security cameras and alarm systems
• Use locks and access controls
• Conduct background checks and promote a culture of accountability

2. Water Damage: Leaks, frozen pipes, and ice dams are responsible for major property claims—especially in colder climates like Wisconsin and Minnesota.

Prevention tips:

• Insulate pipes and maintain HVAC systems
• Regularly inspect roofs, gutters, and plumbing
• Know how to shut off your water supply quickly

3. Wind and Hail Damage: Hail and wind damage are frequent culprits when it comes to small-business damage. Severe storms can lead to expensive repairs to roofs, siding, signage, and even fleet vehicles.

Prevention tips:

• Reinforce roofing and exterior structures
• Move vehicles indoors when possible
• Review your policy to make sure wind and hail are covered

4. Fire and Smoke: Fires can cause total loss for a business. Electrical faults, cooking equipment, and flammable materials are common culprits.

Prevention tips:

• Test smoke detectors and fire extinguishers regularly
• Train staff on evacuation procedures
• Follow all local fire codes and equipment guidelines

5. Customer Slip-and-Fall Accidents: Slip-and-fall claims are one of the most frequent liability claims for brick-and-mortar businesses.

Prevention tips:

• Keep walkways clear and dry
• Post warning signs when floors are wet
• Repair cracks, potholes, and other hazards promptly

6. Other Injuries or Property Damage: In addition to slips and falls, customers sometimes sustain other injuries or damage to their property.

Prevention tips:

• Conduct routine safety audits
• Maintain clear pathways and signage
• Train staff on how to handle incidents

7. Product Liability: If your business sells, manufactures, or distributes products, there’s always a chance something could go wrong.

Prevention tips:

• Test thoroughly before launch
• Keep documentation of safety checks
• Use clear, accurate product labeling and instructions

8. Struck by Objects: Some claims are the result of injuries caused by moving objects. Injuries caused by falling items, equipment movement, or even improperly stacked inventory fall into this category.

Prevention tips:

• Secure shelving and storage units
• Follow safety protocols for heavy equipment
• Limit access to high-risk areas

9. Reputational Harm (Libel & Slander): Negative publicity or unintentional misstatements can lead to claims of defamation.

Prevention tips:

• Review marketing and public communications carefully
• Avoid making claims about competitors
• Consult legal counsel when unsure

10. Commercial Auto Accidents: If your business uses vehicles—whether delivery vans or sales fleet—accidents are always a risk.

Prevention tips:

• Create a driver safety policy
• Ensure drivers are properly licensed and trained
• Maintain vehicles regularly

Is Your Business Protected?

Running a business comes with risk but insurance helps make sure one incident doesn’t derail everything you’ve built. By understanding common business insurance claims and taking simple prevention steps, you can reduce your exposure and keep your operation running smoothly.

At Forward Insurance, we work with businesses across Wisconsin and Minnesota to protect what matters most—your people, your property, and your peace of mind. Whether you need a full policy review or want to explore options for expanding your coverage, our local agents are here to help.

Connect with your local Forward Insurance agent today.

_{This article is for informational purposes only. Coverage options and requirements may vary based on individual circumstances and location. Please consult with a licensed insurance professional to discuss your specific needs and policy details.}