Most business owners didn't start their company to think about insurance. They started it to build something — a contracting crew, a salon, a consulting practice, a restaurant. Insurance tends to get handled quickly, often because a client, landlord, or lender asked for a certificate. That's how businesses end up with coverage that satisfies a contract but leaves serious gaps.
I'm Cody Chipman, an insurance producer with Wilcock Filley & Associates in Gilbert. I help Arizona business owners identify where they're exposed and put together commercial coverage that fits how they operate, then compare options across multiple carriers. You don't need to know the terminology. That's my job.
This page covers the core types of business insurance, what Arizona requires, how premiums are calculated, and the coverage gaps I see most often.
On this page
- Start with a risk review, not a product
- Core types of business insurance
- Specialized coverages to consider
- Coverage by type of business
- Certificates and contract requirements
- What affects the cost of business insurance
- Coverage gaps I see most often
- What to do when something goes wrong
- How I help business owners
- Frequently asked questions
Start with a risk review, not a product
The right business insurance starts with understanding your operations. Before I recommend anything, I want to know:
- What you do, where you do it, and who you do it for
- Whether you have employees, subcontractors, or both
- Which vehicles are used for work, and who drives them
- What property, equipment, tools, and inventory you own or lease
- What your contracts and leases require you to carry
- Whether you handle customer data, give professional advice, or make products
Those answers shape everything that follows. Two businesses with the same annual revenue can need very different coverage depending on their work, their contracts, and their exposures.
Core types of business insurance
- General liability
- Covers claims that your business operations caused bodily injury or property damage to someone else, plus certain advertising and personal injury claims. A customer tripping in your shop or a crew member damaging a client's flooring are typical examples. Most commercial leases and client contracts require it.
- Commercial property
- Protects your building if you own it, plus your equipment, furniture, inventory, and tenant improvements against covered losses such as fire, theft, and wind.
- Business owners policy (BOP)
- Bundles general liability and commercial property into one policy, often with business income coverage included. For many small businesses with lower-risk operations, a BOP is a cost-effective starting point.
- Business income
- Replaces lost income and helps pay ongoing expenses like rent and payroll if a covered loss forces you to close temporarily.
- Commercial auto
- Covers vehicles owned by your business. Hired and non-owned auto coverage protects the business when employees use their own vehicles or rentals for work — a common and overlooked exposure.
- Workers' compensation
- Pays medical bills and lost wages for employees injured on the job, and protects the business against related lawsuits. In Arizona, employers with employees are generally required to carry it, with limited exceptions.
- Commercial umbrella
- Adds liability limits above your general liability, commercial auto, and employer's liability coverage. It's often required for larger contracts and is one of the most cost-effective ways to protect against a major claim.
Specialized coverages to consider
- Professional liability (errors & omissions)
- Covers claims that your advice, design, or professional services caused a client financial harm. Important for consultants, real estate professionals, designers, accountants, and IT firms.
- Cyber liability
- Helps with the costs of a data breach or ransomware attack, including notification, recovery, and liability. If you store customer information or take payments, this exposure is real regardless of your size.
- Inland marine and tools & equipment
- Covers tools, equipment, and materials that move between job sites — something a standard property policy tied to one location may not do well.
- Employment practices liability (EPLI)
- Responds to claims of wrongful termination, discrimination, or harassment from employees or applicants.
- Surety and license bonds
- Arizona contractors are generally required to post a license bond with the Registrar of Contractors, and many projects require bid, performance, or payment bonds.
Coverage by type of business
Every business is different, but here's how needs commonly break down across the industries I work with in the Valley:
- Contractors and trades
- General liability, tools and equipment, commercial auto, workers' compensation, license and contract bonds, and often an umbrella to meet contract requirements.
- Retail and restaurants
- A BOP or package policy, business income, equipment breakdown, food spoilage, and liquor liability if you serve alcohol.
- Professional services
- Professional liability, cyber coverage, a BOP for the office, and hired and non-owned auto for client visits.
- Home-based businesses
- Your homeowners policy typically offers very limited coverage for business property and little or no business liability. A home business endorsement or a small BOP usually closes that gap.
Certificates and contract requirements
Clients, general contractors, landlords, and property managers often require proof of insurance before you can start work. That proof is a certificate of insurance (COI), and contracts frequently ask for specific terms: minimum limits, being named as an additional insured, a waiver of subrogation, or primary and non-contributory wording.
Those requirements need to be supported by actual endorsements on your policy — not just typed on a certificate. When a contract crosses my desk, I'll review the insurance section with you before you sign so there are no surprises later. Once your coverage is in place, I can help you get certificates issued quickly when a new job or lease comes up.
What affects the cost of business insurance
- Your industry and the specific work you perform
- Annual revenue and payroll
- Number of employees and their job classifications
- Claims history
- Vehicles, drivers, and their driving records
- Property values, building construction, and location
- The limits and deductibles you choose
Some policies, particularly general liability and workers' compensation, are priced on estimated payroll or revenue and then audited after the policy year. If your actual numbers come in higher, you may owe additional premium; if lower, you may receive a refund. Keeping your estimates realistic helps avoid surprises at audit time.
Coverage gaps I see most often
- Using personal auto for business
- Personal auto policies may not cover vehicles used primarily for business, especially when titled to the company or used to haul tools and equipment.
- Misclassifying workers
- Treating employees as independent contractors can leave you exposed to a workers' compensation claim and an unexpected bill at audit.
- Uninsured subcontractors
- If your subcontractors don't carry their own coverage, their claims can land on your policy. Collect current certificates before they start work.
- Underinsured equipment and inventory
- Property limits set years ago may not reflect what it would cost to replace everything today.
- No business income coverage
- Many businesses survive a fire but not the months of lost revenue that follow.
What to do when something goes wrong
How you handle the first hours after an incident can affect how smoothly a claim goes. A few habits make a real difference:
- Make sure anyone injured gets medical attention first.
- Document the scene with photos and video, and collect witness names and contact information.
- Avoid admitting fault or promising to pay for damages on the spot — let the insurer handle liability.
- Report the incident promptly. Late notice can complicate or jeopardize coverage.
- Keep records of expenses, lost income, and repair estimates.
- Send any lawsuit papers or demand letters to me or your insurer right away.
When something happens, call me. I'll help you report it to the right carrier, explain what to expect, and stay involved until it's resolved.
How I help business owners
We'll start with a conversation about your operations, contracts, and goals. If you have current policies, I'll review them and identify gaps or overlaps. Then I'll compare options from multiple carriers and explain the differences in plain language.
After your coverage is in place, I stay involved: certificates, renewals, audits, and claims questions all come through me. And because business owners usually have personal coverage needs too, I can help coordinate your commercial policies with your personal home, auto, and umbrella coverage.
Business Insurance: frequently asked questions
What insurance does a small business need in Arizona?
It depends on your operations, but most small businesses start with general liability and property coverage, often through a business owners policy. If you have employees, workers' compensation is generally required. Business vehicles need commercial auto coverage.
Is workers' compensation required in Arizona?
Generally, yes, for businesses with employees, including part-time employees, with limited exceptions. Sole proprietors without employees typically aren't required to cover themselves but may choose to.
What is a certificate of insurance?
A one-page document showing your coverage types, limits, and policy dates. Clients and landlords often require one before you start work or sign a lease. It's proof of coverage, but the actual protection comes from your policy and endorsements.
What's the difference between general liability and professional liability?
General liability covers bodily injury and property damage your business causes. Professional liability covers financial losses a client suffers because of your advice, services, or mistakes. Many service businesses need both.
How much does business insurance cost?
Costs vary widely by industry, revenue, payroll, location, and claims history. A low-risk office business may pay far less than a contractor or restaurant. I'll gather the details and show you real quotes from multiple carriers.
Does my homeowners policy cover my home business?
Usually only to a limited degree. Most homeowners policies provide little coverage for business property and exclude business liability. A home business endorsement or separate policy typically fills the gap.
This page is general information, not a description of any specific policy. Coverage, exclusions, and availability vary by carrier and policy, and the terms of your policy always control. For guidance on your situation, contact Cody.
