If you’ve been told “we can’t quote this” or “you don’t qualify for standard markets,” you’re not alone. For many business owners—especially those in niche industries, high-risk categories, or early-stage startups—trying to secure commercial insurance can feel like banging your head against a wall.
But here’s the good news: being rejected by standard carriers isn’t the end of the road. In fact, it’s often just the beginning of finding the right coverage for your business.
Let’s unpack why standard insurance markets often steer clear of certain businesses and why this challenge might actually be an opportunity to secure the right coverage for your unique business needs.
What Are Standard Insurance Markets?
To understand why standard markets might decline your business, you first need to understand what they are.
Standard insurance markets (think names like Travelers, The Hartford, Liberty Mutual) are carriers that write business through more traditional underwriting appetites. They typically cater to companies with lower risk, meaning businesses with predictable and stable operations, a clean claims history, and minimal liability issues.
If your business doesn’t fit neatly into those boxes, then standard insurance carriers may offer limited coverage that doesn’t actually protect your needs, or decline to provide you a quote altogether.
Why Your Business Might Be Declined
Getting turned down for coverage can be frustrating, especially when you’re trying to do the right thing by protecting your business. But it happens more often than you might think, especially for small businesses, startups, and entrepreneurs with innovative ventures.
Here are some common reasons why a standard market might decline your business:
Your Business is Considered High Risk
Some industries naturally carry more risk, which can make traditional insurers hesitate. Examples include construction, food service, cannabis, and transportation businesses.
These industries often come with potential liability issues, higher claims frequencies, or regulatory complexities that standard markets shy away from.
You’re A Start-Up Business
Established businesses with a proven track record are more attractive to standard markets. If you’re a startup with little or no operating history, a traditional insurer might view you as an unknown entity and decline coverage simply because they can’t adequately assess your risk.
You Have A Claim History
If your business has a history of claims or a record of past losses, standard insurers are likely to see this as a red flag. A pattern of claims, even if minor, can make your business appear riskier to insure.
You Operate in A Niche Market
Businesses offering specialized services or operating in unconventional sectors are often turned away by traditional insurers. Think businesses like handcrafted goat cheese with infused flavors (e.g., truffle, herbs, etc.). Standard insurance markets might not fully understand your operations, making it challenging for them to evaluate your needs or offer an appropriate policy.
Unique Coverage Needs
Some businesses require custom or specialized coverage that standard markets don’t provide. For instance, if you need cyber liability for a biotech startup or pollution liability for an environmental services company, you may need to look beyond traditional carriers.
Enter The Specialty Insurance Market
It’s important to remember that being declined by a standard market does not necessarily mean your business is uninsurable. It means it needs tailord insurance coverage solutions that the standard insurance market either won’t provide or doesn’t have the capacity to provide. This is where the specialty insurance market (also called the Excess & Surplus Lines market or E&S market) steps in.
Specialty insurance carriers cater to unique, high-risk, or emerging businesses that require tailored coverage. These insurers are typically not bound by the rigid underwriting criteria of standard markets, which allows them to offer more flexible and innovative solutions.
Customized Coverage
Rather than trying to fit into a cookie-cutter policy, specialty insurance offers customized coverage designed to match the nuances of your business operations. It addresses risks that standard markets either can’t or won’t.
Wider Risk Appetite
Writing policies for high-risk or niche industries is what these providers do best. Whether it’s a microbrewery, a mobile pet groomer, or a cybersecurity firm, they’ve likely seen it all.
Emerging Market Expertise
Specialty insurers are tuned into emerging trends and industries, like the cannabis industry. This often gives them a greater understanding of businesses that are too new or unconventional for standard markets to understand.
Flexibility for Unique Needs
Specialty markets often provide options for businesses requiring non-standard policy features like higher liability limits, coverage for unknown risks, or broader inclusions (such as professional liability for a new legal field).
Steps to Take if You’ve Been Declined by Standard Markets
Now that you know that being rejected by the standard markets isn’t the end, here are some best practices to ensure you get the right coverage for your unique business needs:
Find the Right Insurance Broker
Navigating specialty insurance markets isn’t something just any agent or broker can do. It requires a consultative approach to gathering operational details about your business, and then properly crafting submissions to specialty market carriers.
It also requires solid relationships with wholesaler brokers and Managing General Agents who specialize in non-standard risks. Insurance agents and brokers who focus on specialty insurance markets risks also know how to follow-up with the specialty marekts to move deals across the finish line as quickly as possible.
Be Transparent About Your Business
When applying for insurance, honesty is the best policy. Provide detailed information about your operations, risks, and claims history to your broker. Specialty insurers value transparency and are more likely to create tailored solutions when they have all the information.
Understand Your Coverage Needs
Take time to evaluate your specific risks and identify the types of coverage you need. This proactive approach will help ensure you’re not underinsured or overpaying for coverage you don’t actually need. Your trusted insurance advisor can help you with this step.
Invest in Risk Management
Taking steps to reduce your business risks can make you more attractive to specialty insurance carriers. These steps might include implementing safety protocols, training employees on best practices, or upgrading equipment.
Be Prepared for Higher Premiums
Specialty insurance often comes with higher premiums than standard market coverage. While this might be frustrating, remember that higher premiums reflect the unique nature of your business. They also reflect the comprehensive protection you’re receiving compared to the standard insurance market.
Don’t Look at Standard Markets as Your Only Option
At the end of the day, a “no” from standard markets doesn’t mean your business is uninsurable. It typically means your insurance needs require a more customized solution.
Whether you’re a startup, operate in a high-risk field, or simply need coverage beyond the basics, specialty insurance isn’t a fallback. It’s a powerful tool for real-world business protection. Again, understanding why standard markets won’t insure your business—and why that’s not the end—is key to ensuring you get the right insurance coverage for your business.
If your business is struggling to find the right insurance coverage, don’t wait—reach out to BR Risk Group™ Specialty Insurance for expert guidance. Our experienced team understands the hurdles small businesses and startups face, and we’re here to connect you with solutions that align with your goals and vision.
Disclaimer: This content is for informational purposes only and should not be considered as legal or financial advice.