75% of Small Businesses Are Under-Insured [April 2025 Newsletter]

Did you know 35% of small businesses don’t have any general liability coverage? What’s more, 39% of small businesses admit they’ve never updated their general liability policy after initially purchasing it. In 2024, 75% of small businesses were under-insured or had significant gaps in coverage.¹ 

The numbers don’t lie; small businesses everywhere need your help! For producers, this presents both a challenge and an opportunity—ensuring your insureds have the right coverage means protecting their business before a loss occurs.  

Here are some great catalysts for a conversation with prospects and insureds about being under-insured and finding gaps in coverage:

1️⃣ When was the last time you reviewed your policy?(Coverage needs to evolve as businesses grow.) 

2️⃣ Are you covered for client lawsuits, property damage, and business interruptions? (Many assume they are—but gaps often exist here that you can help drill into.) 

3️⃣ Have you considered short-term or project-based policies to fill seasonal coverage gaps? (A flexible approach ensures year-round protection.) 

Your expertise is their safety net. Let’s close the coverage gap together! 💡🔍 

Weathering Disaster: Small Business Should Prepare For More Challenges

Experts say the last 12 months have been “the most costly stretch of extreme weather in America in 90 years.” Are your insureds prepared for the next 12 months?² 

The recent Southern California wildfires are likely to be thecostliest in US history. “To put this into perspective, the total damage and economic loss from this wildfire disaster could reach nearly 4% of the annual GDP of the state of California.”²

 🔥$275 Billion in total damage and economic loss for Southern CA’s 2024-2025 wildfires² 

Compare to: Hurricane Helene’s total damage and economic loss rang in at $225-$250 billion in 2024² 

 🔥$40 Billion of insured losses from the LA wildfires alone² 

Compare to: The last record set for the costliest wildfire was the Camp Fire in Paradise, CA in 2018 at $12.5B if adjusted for inflation³

Talking to your insureds about how to prepare for the next record-breaking disaster is key. “Many people may not realize the significant financial strain that a small business like ours faces,” Café owner Rockey Smeir says. “With payroll, rent, and taxes due, the loss of inventory and revenue from being closed for nearly a week can be financially devastating.” Planning ahead for worst-case scenarios like Smeir’s is imperative. 

Get Back to Binding after Natural Disaster 

Thankfully, Thimble confirmed its reinsurer had lifted all binding restrictions initially imposed due to wildfire activity in southern California as of January 30, 2025. While carriers continued to pull coverage, causing ongoing challenges for small business owners, Thimble producers were able to resume selling to insureds all across California. 

Thimble is committed to getting you back to binding as fast as possible when disaster strikes. After all, the faster your insureds can get back to earning, the better. 

Updated April 20, 2025 00:28