How Much Does Business Insurance Cost For Locksmiths? 2025 Rates

U.S. locksmith businesses can expect to pay between $540 and $780 annually for comprehensive business insurance, averaging $45 to $75 per month. The primary cost drivers are location, services offered, business size, claims history, coverage limits, and number of employees.

How Much Does Locksmith Insurance Cost?

In the U.S., locksmiths typically spend around $540 to $780 a year for full business insurance, which comes out to about $45 to $75 per month. This is only a general estimate, your actual cost may be higher or lower depending on the size of your business, and the coverage you need. 

If you run a locksmith business, having the right insurance is important to protect yourself, your employees, and your clients. The cost can vary depending on factors like the size of your business, the services you offer, and where you operate. 

Here are some of the biggest cost drivers:

• Number of employees (affects workers’ comp and liability)
• Property size and value (affects commercial property coverage)
• Types of services offered (affects general liability and professional liability) 
• Location and state regulations (affects workers compensation and commercial auto insurance)
• Past claims history (insurers charge more if you’ve filed claims)
• Business interruption coverage and other add-ons

Knowing these factors can help you figure out the insurance your locksmith business really needs and plan for the actual costs of keeping it protected. 

Average Locksmith Insurance Costs For Coverage Types

Locksmith businesses need different types of insurance to protect themselves, their employees, and their clients. Each type of coverage has its own cost depending on the risks it protects against. Let’s look at the average costs for the main types of locksmith insurance, so you can understand what to expect and decide which coverage is right for your business. 

• General liability insurance: $45 per month
• Business owner’s policy: $50 per month
• Workers’ compensation insurance: $250 per month
• Commercial auto insurance: $168 per month
• Professional liability insurance: $79 per month
• Contractor’s tools and equipment: $14 per month
• Commercial umbrella insurance: $76 per month

General Liability Insurance

The average cost of general liability insurance for a locksmith business is about $45 per month.

General liability protects your locksmith business from financial losses if an accident happens on the job. For instance, if you damage a client’s property or someone is hurt while you’re working, this insurance can repair costs, medical bills, or legal expenses. 

Factors that influence the cost include the business size, location, customer traffic volume, previous claims history, and any subcontractors or additional insured endorsements.

This policy is essential for locksmiths because even small mistakes or accidents can become costly. 

Policy limits: $1 million per occurrence and $2 million aggregate.

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

Note: Estimates are modeled from typical annual premiums for General Liability Insurance for locksmith businesses, using an average blend of quotes from small and large insurance agencies; actual premiums will vary by insurer, coverage limits, business size, claims history, services offered (mobile service, on-site rekeying, high-security systems), and local risk factors.

Business Owner’s Policy (BOP)

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

A BOP is a bundle of insurance coverages designed for small businesses. For a locksmith business, a BOP usually combines general liability insurance and property insurance. 

The main benefit of a BOP is that it provides several essential protections in one policy, often at a lower cost than buying each type of insurance separately. 

Cost factors include the size of your business, the amount of foot traffic, and the value of your business property.

Policy limits: $1 million per occurrence and $2 million aggregate.

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

Note: Estimates are modeled from typical annual premiums for a Business Owner’s Policy (BOP) for locksmith businesses, using an average blend of quotes from small and large insurance agencies; actual premiums will vary by insurer, coverage limits, business size, location, claims history, on‑site versus mobile services, and policy endorsements.

Workers’ Compensation Insurance

The average cost of workers’ compensation insurance for a locksmith is around $250 per month.

Workers compensation insurance protects your employees if they get hurt or sick while working for your locksmith business. In many states, workers compensation is required by law, and even if it isn’t, it’s a smart way to keep your team and business safe. 

Each state sets rules for workers compensation limits, but generally the insurance covers medical expenses and a portion of the employee’s lost wages, often without a fixed maximum. 

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

Note: Estimates are modeled from average annual Workers’ Compensation premiums for locksmith businesses, using a blend of typical quotes from small and large insurance agencies; actual premiums will vary by payroll size, employee classifications, state rate filings, experience modifier, claim history, coverage limits, and other business-specific risk factors.

Commercial Auto Insurance

The average cost of commercial auto insurance for a locksmith is about $168 per month.

Commercial auto insurance covers vehicles owned or used by the business for accidents, theft, vandalism, or damage. For example, if you’re driving your work van to a client’s location and get into an accident, this policy would help cover the repair costs for your vehicle and any damage or injuries caused to others.

Factors influencing the cost include your coverage needs, the value of the vehicle, and your insurance claims history.

Since personal car insurance usually doesn’t cover business use, commercial auto insurance is important to keep your vehicles and business protected. 

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

Note: Estimates are modeled from average annual Commercial Auto premiums for locksmith businesses, using a blend of typical quotes from small and large insurance agencies and reflecting locksmith-specific exposures (mobile service calls, on-site work, tool transport). Actual premiums will vary by number and type of vehicles, annual mileage, driving records, coverage limits and deductibles, garaging ZIP code, endorsements, and individual insurer underwriting.

Professional Liability Insurance

The average cost of professional liability insurance for a locksmith is about $79  per month.

Professional liability insurance (also called Errors and Omissions Insurance) protects your business if a customer claims you made a mistake, gave bad advice, or didn’t do the job properly, and it caused them a financial loss.

For example, if you install a new lock system but accidentally leave it vulnerable to break-ins, and the customer’s property gets burglarized, they might sue you for negligence. This insurance would help cover legal fees and any compensation you’re required to pay.

The cost of professional liability insurance depends on things like how much coverage you want, how big your business is, and the kind of services you provide.

Policy limits: $1 million per occurrence; $1 million aggregate

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

Note: Estimates are modeled from average annual Professional Liability premiums for locksmith businesses, using a blend of typical quotes from small and large insurance agencies; actual premiums will vary by insurer, coverage limits, business size, services offered (mobile service, high-security systems), claims history, and regional risk factors.

Contractor’s Tools And Equipment

The average cost of contractor’s tools and equipment insurance for a locksmith business is about $14 per month.

Contractor’s tools and equipment insurance protects the tools and equipment you use for your locksmith business. This can include things like lock-picking tools, key machines, drills, and other specialized equipment. It’s especially useful for locksmiths because replacing specialized tools out of pocket can be expensive. 

The cost of contractor’s tools and equipment coverage depends on the value of your tools and equipment and the type of work you do.

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

Note: Estimates are modeled from average annual premiums for Contractor’s Tools and Equipment coverage for locksmith businesses, using a blend of typical quotes from small and large insurance agencies and reflecting locksmith-specific exposures (value of portable tools, mobile service calls, on‑site work, and endorsements). Actual premiums will vary by insurer, total declared tool value, coverage limits and deductibles, business size, claims history, garaging/operation ZIP codes, and other risk factors.

Commercial Umbrella Insurance

The average cost of commercial umbrella insurance for a locksmith business is about $76 per month.

Commercial umbrella insurance gives your business extra protection by adding more coverage on top of your existing liability policies (like general liability or commercial auto). It kicks in when the costs of a claim go over the limits of your other insurance.

For example, if a customer is seriously injured due to a faulty lock installation and sues you for $1.5 million, but your general liability policy only covers $1 million, umbrella insurance would help cover the remaining $500,000.

The cost of commercial umbrella insurance mainly depends on how much extra coverage you choose to buy.

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

Note: Estimates are modeled from average annual Commercial Umbrella premiums for locksmith businesses, using a blend of typical quotes from small and large insurance agencies and reflecting locksmith-specific exposures (mobile service calls, on-site liability, number of employees, and contractual requirements); actual premiums will vary by insurer, policy limits, underlying primary coverages, claims history, business size, and regional risk factors.

Locksmith Business Insurance Costs By Provider

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

Note: These estimates are based on average annual premiums for home inspection businesses from both small and large agencies, and reflect typical coverages such as general liability, professional liability (E&O), a business owner’s policy (BOP), and workers’ compensation; actual premiums will vary by location, experience, claims history, number of employees, and chosen coverage limits

What Factors Impact Your Locksmith Insurance Costs?

The cost of locksmith insurance can vary depending on several factors. Insurance companies, also called underwriters, look at different aspects of your business when deciding your rates. Understanding these factors can help you plan and budget for the right coverage. 

Type Of Locksmith Services

Not all locksmiths face the same risks. If you only cut keys at a retail location, your insurance costs may be lower. But if you offer 24/7 emergency lockout services, vehicle unlocking, or high-security system installations, your premiums may be higher due to the increased risk and complexity of the work.

Extra Services And Add-Ons

Offering extra services, like smart lock installation, safe opening, or access control systems, can raise your insurance cost. These services may carry higher risks, especially if they involve expensive equipment or sensitive security setups.

Location

Where your locksmith business operates matters. Working in big cities with higher crime rates or more legal claims can increase your insurance costs. Businesses in smaller towns or lower-risk areas often pay less for coverage.

Size Of Your Business

A solo locksmith working out of a van will likely pay less than a larger company with multiple employees, vehicles, and shop locations. More employees and equipment mean higher chances of accidents, which can raise the cost of workers’ comp and commercial auto insurance.

Value Of Your Tools And Equipment

Locksmiths often use specialized tools like key-cutting machines, drills, lock picks, and programming devices. The more valuable your tools, the more you’ll pay for coverage like contractors tools and equipment insurance.

Claims History

If you’ve had past insurance claims, such as damaging a customer’s property or being involved in an accident, your premiums may go up. A clean claims record shows you’re low-risk and can help you get better rates.

Insurance Provider

Not all insurance companies are the same. Some specialize in trades like locksmithing and may offer better pricing, custom coverage options, or more flexible terms. It’s smart to compare quotes from a few providers to get the best deal.

How To Lower Your Locksmith Insurance Costs

Insurance is an important part of running a locksmith business, but it doesn’t have to be expensive. With the right steps, you can reduce your insurance costs while still keeping your business fully protected. 

1. Bundle Policies

Buying several types of insurance, like general liability and commercial auto, from the same company can often get you a discount. It’s cheaper than buying each policy from different insurers. 

2. Increase Your Deductible

A higher deductible means you’ll pay more out of pocket if something goes wrong, but your monthly or yearly insurance payments will be lower. This is a good option if you rarely file claims.

3. Shop Around For Quotes

Different insurance companies offer different prices. Getting quotes from multiple insurers helps you compare options and find the best deal for your locksmith business. 

4. Pay Annually Instead Of Monthly

Many insurance companies give a discount if you pay for the full year up front. Even though it costs more at once, it often saves money in the long run. 

5. Improve Safety Practices

Training employees, using proper tools, and following safety procedures can reduce accidents. When underwriters see that your business is safer, they may offer lower rates.