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.

Most common claims in 2025

Most expensive claims in 2025

(Property claim averages reflect direct repair or replacement only and do not include additional loss event costs like business interruption. Average costs can be higher if a lawsuit is involved. The Hartford’s 2015 claim costs have not been adjusted for inflation.)[/sidebar]

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.