Hartford: 10-Year Analysis Shows Shifts in Common, Expensive Small-Business Claims

Liability risks for small businesses have shifted over the last decade, with fire and slip-and-falls becoming more expensive while water and freezing damage claims are now the most common type of claim.

The Hartford analyzed more than one million small-business property and liability policies and small-business claims from 2020 to 2024. The 2025 analysis builds on a 2015 claims report, allowing for a 10-year comparison of the most common and most expensive risks.

Water and freezing damage represented approximately 22% of small-business claims over the past five years, averaging $34,600 per claim – the fourth most costly. It was the most common type of claim in 2025, with the volume of claims rising from 15% to 20% since 2015. Water and freezing damage generally involve damage from wind-driven water or burst pipes.

Claims involving fire are the most expensive, with the average cost of fire damage claims rising from $35,000 in 2015 (approximately $47,600 adjusted for inflation) to $80,000 in 2025, making it the top-ranked costliest claim. However, it represents just 10% of claims, ranking as the fifth most common type.

The number of slip, fall and customer-injury claims also increased from 10% of claims in 2015 to 20% of claims in 2025, while becoming more expensive per incident. While the average claim was $20,000 in 2015, it has more than doubled to $45,000 in 2025, said Hartford. The trend is due in part to a growing influence of litigation and legal system abuse, resulting in higher settlements and costlier verdicts.

Burglary and theft represented 20% of claims in 2025, making it the second most common, while wind and hail claims remained consistent (15%) over the decade. Wind/hail claims generally involve structural damage, primarily to roofing or signage.

Reputational harm was the most expensive type of claim in 2015 at $50,000 per incident, but the costs have dropped to $35,000 in 2025.

Topics Claims