How Much Does Engineering Business Insurance Cost? 2025 Rates

U.S. engineering businesses can expect to pay between $504 and $768 annually for comprehensive business insurance, averaging $42 to $64 per month. The primary cost drivers are business size, services offered, location, number of employees, project types, equipment value, claims history, coverage limits, and safety practices.

How Much Does Engineering Business Insurance Cost?

The average engineering business in the U.S. might pay around $504 to $768 per year for a full insurance package, or about $42 to $64 per month. But this is just a rough estimate, your actual cost could be higher or lower depending on how your business is set up.

A small engineering firm with a simple office and no employees will usually pay much less than a larger company with expensive equipment, fieldwork, or multiple staff members.

Things that can affect your business insurance cost include the type of engineering work you do, where you’re located, how many people you employ, the value of your tools and equipment, and your overall safety record. For example, a firm working on construction sites or in high-risk areas will likely pay more than one that handles only design work in an office.

Here are some of the biggest cost drivers:

• Number of employees (affects workers’ comp and liability)
• Property size and value (affects commercial property coverage)
• Past claims history (insurers charge more if you’ve filed claims)
• Business interruption coverage and other add-ons

Understanding these variables can help you better estimate your insurance needs and prepare for the real costs of protecting your engineering business.

Average Engineering Business Insurance Costs For Coverage Types

When it comes to protecting your engineering business, different types of insurance cover different risks. Understanding the average cost, coverage details, and what influences pricing for each policy type can help you build a more effective insurance plan. Here’s a closer look at the major coverages most engineering businesses need.

• General liability insurance: $42 per month
• Business owner’s policy: $50 per month
• Workers’ compensation insurance: $41 per month
• Commercial auto insurance: $96 per month
• Professional liability (E&O) insurance: $161 per month

General Liability Insurance

The average cost of general liability insurance for an engineering business is about $42 per month.

General liability covers third-party bodily injury, property damage, and advertising injuries. For instance, if an engineering firm is conducting an on-site inspection at a client’s facility and one of their employees accidentally knocks over and damages an expensive piece of equipment, general liability insurance would help cover the repair or replacement costs, as well as any legal fees if the client decides to sue.

Typical policy limits are $1 million per occurrence and $2 million aggregate.

Factors that influence the cost include the business size, location, customer traffic volume, and previous claims history.

Here’s a look at the average annual premiums for 10 different states:

Note: These are illustrative averages for basic GL coverage on a small engineering firm; actual premiums vary with revenue, payroll, claims history, limits/deductibles, and carrier.

Business Owner’s Policy (BOP)

The average cost of a business owner’s policy (BOP) is about $50 per month for engineering business.

A BOP bundles general liability insurance with commercial property insurance. It protects against customer injuries, property damage, and loss or damage to the equipment. For example, if an electrical fire breaks out in your engineering office and damages computers, blueprints, and specialized design equipment, the BOP would help cover the cost of repairs and replacements, as well as any business interruption losses.

Typical policy limits are $1 million per occurrence and $2 million aggregate for liability, with separate property coverage limits based on the value insured.

Cost factors include the property value, location risk (such as flood or crime rates), business revenue, number of employees, and any optional endorsements like business interruption insurance.

Here’s a look at the average annual premiums for 10 different states:

Note: These averages represent small-to-medium engineering firms combining general liability and commercial property coverage under a BOP. Actual premiums depend on factors like business size, number of employees, office location, claims history, and coverage limits.

Workers’ Compensation Insurance

The average cost of workers’ compensation insurance for an engineering business is around $41 per month.

Workers’ comp covers medical bills, rehabilitation, and lost wages for employees injured on the job. For example, if a field engineer falls from scaffolding while inspecting a construction site and suffers a back injury, workers’ compensation would help pay for their medical treatment, physical therapy, and a portion of their lost wages while they recover and are unable to work.

Policy limits are regulated by each state, but typically include medical costs and a percentage of lost wages without a set cap.

Premiums are influenced by the size of your payroll, the type of work employees perform, your claims history, and any implemented safety programs.

Here’s a look at the average annual premiums for 10 different states:

Note: These figures represent estimated annual premiums for a small engineering firm with moderate payrolls and standard coverage limits. Actual costs vary based on total payroll, employee roles (field vs. office), claims history, and each state’s workers’ comp rates.

Commercial Auto Insurance

The average cost of commercial auto insurance for an engineering business is about $96 per month.

Commercial auto insurance covers vehicles owned or used by the business for accidents, theft, vandalism, or damage. For example, if an engineer is driving a company vehicle to a project site and accidentally rear-ends another car, commercial auto insurance would help cover the repair costs for both vehicles, as well as any medical expenses or liability claims from the other driver.

The cost of commercial auto insurance for an engineering business depends on several factors. These include how much coverage you choose, any extra options you add, such as additional insured endorsements, the number of vehicles you own, their total value, and the driving records of all employees allowed to drive them.

Here’s a look at the average annual premiums for 10 different states:

Note: These estimates assume coverage for a few business-owned vehicles used for site visits, client meetings, and equipment transport. Actual premiums vary based on driving records, vehicle types, mileage, location risk, and chosen liability limits.

Professional Liability Insurance

The average cost of professional liability insurance for an engineering business is about $161 per month.

Professional liability insurance protects your engineering business if a client claims you made a mistake, gave bad advice, or didn’t deliver work as promised. It covers legal fees, settlements, and damages.

For example, if a structural engineer designs a building and later a flaw is found that causes a delay or extra costs, the client might sue. This insurance would help cover the legal costs and any payouts.

The cost of professional liability insurance depends on a few things, like the type and size of your business, your past claims, the kind of projects you work on, where your business is located, and how much coverage and deductible you choose.

Here’s a look at the average annual premiums for 10 different states:

Note: Professional liability insurance typically costs more for engineering firms than general liability, as it covers design errors, project delays, or professional mistakes. Actual premiums depend on firm size, project types, contract values, and prior claims history.

Engineering Business Insurance Costs By Provider

Engineering business insurance costs will vary greatly depending on the insurance carrier. Use the table below to find average costs across 5 providers.

Note: These estimates are based on small-to-medium engineering firms with moderate project risk, few past claims, and standard policy limits (typically including general liability, professional liability, and property coverage). Actual premiums will vary depending on business size, location, annual revenue, number of employees, claims history, and selected coverage options.

What Factors Impact Your Engineering Business Insurance Costs?

Engineering business insurance premiums are carefully calculated by underwriters based on your company’s level of risk. Factors like the type of engineering services you provide, the size and location of your projects, your past claims history, and the number of employees all affect how much you’ll pay for coverage. The higher the risk, the higher the premium is likely to be.

Type Of Engineering Work

Different types of engineering projects carry different risks. For example, civil engineering on large construction sites might cost more to insure than small office-based consulting work.

Location

Where your business and projects are located matters. Areas prone to natural disasters or with high theft rates usually have higher insurance costs.

Size Of Your Business

Bigger companies with more employees, equipment, and larger projects usually pay higher insurance premiums because they have more exposure to risk.

Equipment And Property Value

Expensive tools, machines, and office equipment increase your property insurance costs. You might also add extra coverage for things like equipment breakdown.

Claims History

If your business has made many insurance claims before, your rates will likely be higher. A clean record can help you get lower prices.

Policy Limits And Deductibles

Choosing higher coverage limits gives you better protection but costs more. Picking a bigger deductible lowers your premium but means you pay more out-of-pocket if something happens.

How To Lower Your Engineering Business Insurance Costs

Running an engineering business is expensive, but your insurance bill doesn’t have to break the bank. While you can’t eliminate the need for coverage, you can take smart steps to reduce your premiums without sacrificing protection. Here are some practical ways to lower your engineering business insurance costs:

1. Bundle Your Policies

One of the easiest ways to save is by bundling multiple policies. Most insurers offer a Business Owner’s Policy (BOP) that combines general liability and property insurance at a lower rate than if you bought them separately. If you also need workers’ compensation, bundling both through the same provider can lead to additional discounts. Not only does this simplify your paperwork, but it also makes your coverage more cost-efficient.

2. Ask About Discounts

Insurance companies often reward businesses that commit to a policy long-term. Ask your provider if they offer multi-year discounts for signing a two- or three-year agreement instead of renewing annually. You might also qualify for lower rates if you pay your premium in full instead of in monthly installments.

3. Implement Safety Measures

Accidents can be costly for both your engineering business and your insurance company. Taking steps to reduce the chance of employee or client injuries can help lower your insurance premiums over time. For example, keeping work sites clean and organized, using proper safety gear, regularly inspecting and maintaining equipment, and providing safety training to employees can reduce your general liability risk.

4. Create A Safe Working Environment

A strong safety program can help lower your workers’ compensation insurance costs. This includes training employees on proper use of tools and machinery, wearing protective gear, following site safety protocols, and having clear emergency procedures. Fewer workplace accidents mean fewer insurance claims, and that can lead to lower premiums over time.

5. Adjust Your Deductible

Your deductible is the amount you pay out of pocket before insurance coverage kicks in. Choosing a higher deductible can significantly reduce your monthly premiums. Just make sure you can comfortably cover that amount if a claim arises.

By taking these steps, you not only save money but also make your business a safer, and more resilient business.