Best Small Business Insurance in Wisconsin

Wisconsin Insurance Requirements

Workers' compensation insurance is required by the state of Wisconsin for any business with three or more full-time or part-time employees. 

Any company that owns and operates any motor vehicles in the state of Wisconsin must also carry commercial auto insurance.

In addition, Wisconsin has laws in place about data breaches that require customers and employees whose information was exposed to be notified. Cyber liability insurance is not required by law, but it is highly recommended because the costs of data breaches and cyber attacks can quickly add up to millions of dollars.

Workers’ Compensation Insurance

Workers’ compensation has been a requirement in Wisconsin since 1911 and is governed under Wisconsin's Workmen’s Compensation Act. Wisconsin statute requires that all employers with three or more total employees (part-time and full-time) provide worker’s compensation insurance:

§ 102.04: Definition of employer

(1) The following shall constitute employers subject to the provisions of this chapter:

(b) 1. Every person who usually employs 3 or more employees for services performed in this state, whether in one or more trades, businesses, professions, or occupations, and whether in one or more locations.

2. Every person who usually employs less than 3 employees, provided the person has paid wages of $500 or more in any calendar quarter for services performed in this state. Such employer shall become subject on the 10th day of the month next succeeding such quarter.

(c) Every person engaged in farming who on any 20 consecutive or nonconsecutive days during a calendar year employs 6 or more employees, whether in one or more locations. The provisions of this chapter shall apply to such employer 10 days after the twentieth such day.

Employers who fail to obtain workers' compensation insurance for their employees may be subject to penalties and fines of up to $1,000 for the first 10 days in violation of the law and up to $100 per day after 10 days:

§ 102.85: Uninsured employers; penalties

(1) (a) An employer who fails to comply with s. 102.16 (3) or 102.28 (2) for less than 11 days shall forfeit not less than $100 nor more than $1,000.

(b) An employer who fails to comply with s. 102.16 (3) or 102.28 (2) for more than 10 days shall forfeit not less than $10 nor more than $100 for each day on which the employer fails to comply with s. 102.16 (3) or 102.28 (2).

Commercial Auto Insurance

The State of Wisconsin also requires any business whose employees use corporate vehicles as part of their jobs to carry commercial auto insurance. According to the Wisconsin Commissioner of Insurance, it is against the law to drive a car without insurance or other proof of financial responsibility. It is also against the law for a car owner to permit a driver to use their vehicle without proof of financial responsibility.

Wisconsin State Statutes, Chapter 344, Financial Responsibility governs the financial responsibility of owning and operating an automobile in the state of Wisconsin and sets penalties for failure to maintain proof of financial responsibility:

§ 344.62: Motor vehicle liability insurance required

(1) Except as provided in s. 344.63, no person may operate a motor vehicle upon a highway in this state unless the owner or operator of the vehicle has in effect a motor vehicle liability policy with respect to the vehicle being operated.

(2) Except as provided in s. 344.63, no person may operate a motor vehicle upon a highway in this state unless the person, while operating the vehicle, has in his or her immediate possession proof that he or she is in compliance with sub. (1). The operator of the motor vehicle shall display the proof required under this subsection upon demand from any traffic officer. The proof required under this subsection may be produced in either printed or electronic format, including by display of electronic images on a cellular telephone or other electronic device. If this proof is displayed in electronic format on any cellular telephone or other electronic device, the traffic officer may not view, and producing proof in electronic format is not considered consent for the traffic officer to view, any content on the telephone or other device except the proof required under this subsection.

Wisconsin statute also requires drivers to be able to provide proof of financial responsibility and defines minimum coverage limits of $25,000 per person, $50,000 per accident, and $10,000 in property damage coverage:

§ 344.01: Words and phrases defined 

(d) “Proof of financial responsibility" or “proof of financial responsibility for the future" means proof of ability to respond in damages for liability on account of accidents occurring subsequent to the effective date of such proof, arising out of the maintenance or use of a motor vehicle in the amount of $25,000 because of bodily injury to or death of one person in any one accident and, subject to that limit for one person, in the amount of $50,000 because of bodily injury to or death of 2 or more persons in any one accident and in the amount of $10,000 because of injury to or destruction of property of others in any one accident.

Data Breach Insurance

The State of Wisconsin has laws requiring businesses that handle individuals' personal identifying information (PII) and personal health information (PHI) to notify individuals of security breaches involving their personal information.

Wisconsin statute requires that businesses that do business in Wisconsin or keep personal information about people who live in Wisconsin must tell customers or employees if their personal information has been accessed by unauthorized persons. 

§ 134.98: Notice of unauthorized acquisition of personal information

(a) If an entity whose principal place of business is located in this state or an entity that maintains or licenses personal information in this state knows that personal information in the entity's possession has been acquired by a person whom the entity has not authorized to acquire the personal information, the entity shall make reasonable efforts to notify each subject of the personal information. The notice shall indicate that the entity knows of the unauthorized acquisition of personal information pertaining to the subject of the personal information.

(b) If an entity whose principal place of business is not located in this state knows that personal information pertaining to a resident of this state has been acquired by a person whom the entity has not authorized to acquire the personal information, the entity shall make reasonable efforts to notify each resident of this state who is the subject of the personal information. The notice shall indicate that the entity knows of the unauthorized acquisition of personal information pertaining to the resident of this state who is the subject of the personal information.

(bm) If a person, other than an individual, that stores personal information pertaining to a resident of this state, but does not own or license the personal information, knows that the personal information has been acquired by a person whom the person storing the personal information has not authorized to acquire the personal information, and the person storing the personal information has not entered into a contract with the person that owns or licenses the personal information, the person storing the personal information shall notify the person that owns or licenses the personal information of the acquisition as soon as practicable.

(br) If, as the result of a single incident, an entity is required under par. (a) or (b) to notify 1,000 or more individuals that personal information pertaining to the individuals has been acquired, the entity shall without unreasonable delay notify all consumer reporting agencies that compile and maintain files on consumers on a nationwide basis, as defined in 15 USC 1681a(p), of the timing, distribution, and content of the notices sent to the individuals.

(cm) Notwithstanding pars. (a), (b), (bm), and (br), an entity is not required to provide notice of the acquisition of personal information if any of the following applies:

1. 1. The acquisition of personal information does not create a material risk of identity theft or fraud to the subject of the personal information.
   2. The personal information was acquired in good faith by an employee or agent of the entity, if the personal information is used for a lawful purpose of the entity.

Although neither data breach nor cyber liability insurance are required in Wisconsin, the cost of complying with the law if your business experiences a cyber attack can be significant.

Wisconsin Insurance Resources

Wisconsin Department of Transportation
Wisconsin Office of the Commissioner of Insurance
Consumer’s Guide to Insurance for Small Business Owners
Consumer’s Guide to Auto Insurance
Minimum Insurance Requirements
Workers’ Compensation Employer Resources
Workers’ Compensation Insurance Requirements

General Liability Insurance

The vast majority of Wisconsin companies purchase general liability insurance from an insurance company even though it is not legally required. This type of business liability insurance covers third-party bodily injury, third-party property damage, advertising liability, libel, slander, copyright issue, and other common claims faced by companies across various industries. 

General liability insurance is one of the most important types of business insurance your company can purchase.

Business Owner’s Policy

A business owner’s policy (BOP) is an affordable way to bundle business insurance coverages. This type of policy includes commercial general liability insurance with commercial business property insurance. Many small business owners with a physical business space opt for this coverage.

Commercial Auto Insurance

You need to carry commercial auto insurance if your company uses vehicles to transport people or goods. This type of insurance is very similar to personal auto insurance and covers liability, medical costs, collisions, and uninsured/underinsured motorists. A commercial auto policy also covers vehicles rented or owned by your company and employees who use their own vehicles for company business.

Workers’ Compensation Insurance

Wisconsin requires businesses with any full-time or part-time employees to carry workers’ compensation insurance. Taking out workers' compensation insurance puts a limit on the amount and type of compensation that an injured employee may receive. The limits are set by law.

Employee Health/Life/Disability Insurance

Companies that provide health, life, and/or disability insurance as a fringe benefit will need appropriate Wisconsin insurance. Under the Affordable Care Act, firms with more than 50 full-time employees must offer health insurance or pay an expensive penalty.

Professional Liability Insurance

Professional liability insurance covers financial risks to attorneys, accountants, and other people who provide professional services or expertise. Professional liability coverage varies depending on the industry but usually includes negligence, legal defense, slander or libel, and copyright and trademark disputes. 

Professional liability insurance includes errors and omissions (E&O) insurance.

Data Breach Insurance

If your company hosts customers’ personal information on its servers and those servers are hacked, lawsuits and damages can result. Data breach insurance protects you in these cases. 

Cyber Liability Insurance

Similar to but more comprehensive than data breach insurance, cyber liability insurance may pay for legal expenses related to a data breach or set up a call center for individuals affected by a breach. It also may pay for active protection against cyberattacks.

Commercial Crime Insurance

Crimes like extortion, forgery, burglary, computer fraud, and embezzlement are covered by commercial crime insurance. Situations in which this type of insurance is particularly useful include dishonest or libelous acts by employees.

Fiduciary Liability Insurance

Fiduciaries, who are legally required to act in plan participants’ best interests rather than the company’s when choosing advisors and investments, should consider this type of insurance coverage. It covers them if they are sued for allegedly providing negligent investment advice or administering plans or benefits incorrectly. 

Third parties like out-of-company consultants and benefit plan administrators are usually not protected.

Directors and Officers Insurance

Any company with directors and officers should consider directors and officers (D&O) insurance coverage, a type of liability insurance that reimburses directors and officers for claims made against them regarding harm allegedly caused by their management decisions.

Executive Risk Coverage

Executive risk insurance is business liability insurance that provides coverage for fraud, D&O, employment practices, initial public offerings, pension funds, extortion, and professional negligence.