Over 60% of small business owners choose online business insurance

mavo // Shutterstock Speed and convenience are driving small business owners to go digital with their business operations, including small business insurance. And a recent survey shows that they’re increasingly turning to digital platforms that let them research, compare and buy coverage without an agent and 100% online. NEXT surveyed 1,500 nationwide small business owners in January 2025 to better understand this shift in how they buy insurance. Here’s what the survey found. 61% of small business owners buy business insurance online The old ways of buying business insurance — meeting with an agent in person or on the phone — are becoming less desirable for busy business owners. And digital methods, such as buying 100% online or adding insurance through online payroll and financial services, are king. More than half of survey respondents — 61% in total — now report they’re buying online either directly through an insurance company or through a financial service. This tips the scales over the 40% who report they’re still using traditional brokers or agents. An earlier PwC global survey reports similar results. It found 48% of small businesses prefer to buy insurance online. Half of the respondents buy insurance online directly from the company, while 28% use comparison sites or apps. Only 10% said they would use a broker or agent website. One in four business owners research business insurance online NEXT Small business owners are becoming more DIY when learning about their business insurance needs. NEXT’s survey revealed that 24% of participants (roughly one in four) researched online before buying coverage for their business. Just 17% relied on an insurance agent for background information on which types of insurance they require. To address this shift, insurers should upgrade their digital presence and educational resources, and develop guides to help business owners make informed decisions. Those running their own business also relied on a few other channels for learning, including friends, families, mentors and colleagues (13%), as well as professional groups, trade associations, business schools and learning programs (each a source of valuable information for 8% of respondents). Three-way split for why people insure their small business NEXT Motivation to buy small business insurance falls into three buckets pretty evenly for survey participants. Three main reasons to shop and buy stand out, including: Legal compliance (22%): Some business owners choose to buy the least amount of insurance needed; just enough to stay compliant with the law. Maximum protection (21%): These owners want the most amount of insurance protection they can afford against multiple risks. They tend to invest in a broad portfolio of insurance. Selective risk coverage (21%): An equal number of small business insurance buyers prioritize just the policies to safeguard their operations against targeted risks. The results suggest insurers must offer flexible, tailored insurance solutions that cater to small business owners’ varying priorities, budgets and risk appetites. A one-size-fits-all business insurance model simply does not work. Interestingly, and in accordance with previous NEXT survey results, just about a third of those asked (36%) feel that they do not need small business insurance in the workplace. The business insurance knowledge gap — and coverage gap — persists NEXT NEXT research has repeatedly found that small business owners don’t know enough about their small business insurance needs and lack the coverage they require. We found previously that 90% of small business owners lack confidence in their insurance adequacy. And 96% of owners failed to demonstrate a basic understanding of general liability insurance, one of the most common policies sought after by those who own a business. Another research survey of restaurant owners performed earlier in 2025 found that 38% lacked insurance in 2025, up from 29% the previous year. Our most recent data shows that 36% of respondents feel small business insurance is unnecessary, highlighting insufficient awareness of risks and coverage benefits. This significant knowledge gap leaves small businesses vulnerable to unexpected risks and liabilities. 5 tips to make the most of small business insurance Based on what we’ve learned in the field, small business owners need to take action to secure the right coverage for their needs. Use these five tips to guide you: Rely on digital tools. Use online resources to compare business insurance policies and get customized quotes that fit your needs. Ask for a customized policy. Don’t settle for generic coverage. Customize your policies and request flexible options to match your specific risks. Don’t pay for coverage you don’t need. Seek transparency. Request clear, simple explanations from insurers regarding policy terms, pricing and claims processes to prevent gaps and surprises. Understand your risk exposure. Seek coverage beyond just the legal requirement.  Conduct a risk assessment to define the right coverage level for your business, location and the work that you do. Prioritize education. Look for insurers that offer educational tools and guidance to simplify insurance decisions. This story was produced by NEXT and reviewed and distributed by Stacker.