Introduction

This page quantifies typical monthly premiums a Canadian sole proprietor can expect for Commercial General Liability (CGL) in 2025, anchored at a $2,000,000 limit with indicative deltas for $1,000,000 and $5,000,000. It also shows how provincial taxes appear on invoices (Quebec excluded by design).

What CGL covers (context for pricing)

CGL protects against third‑party bodily injury, property damage, and personal/advertising injury arising from business operations. See Summit’s overview for scope, common exclusions, and who needs it.

Market anchor: $2M limit (sole proprietor, low‑hazard)

Based on current Canadian small‑business quoting sources, a typical low‑hazard sole proprietor often lands in the following range for a standalone CGL policy:

• $2M per‑occurrence limit: about $35–$55 per month ($420–$660/year).

Corroborating references (Canadian):

• Zensurance cites about $450/year for a $2M CGL on its Canada pages (which equates to ~$37.50/month).

• Aggregator benchmarks show general liability frequently in the $30–$65/month band for Canadian small businesses.

Notes on variance:

• Premiums move with class of business, location, revenue, subcontracting, claims history, and required certificates/contract terms—factors also highlighted by Summit and Zensurance.

Limit deltas around the $2M anchor (indicative)

Pricing for higher liability limits is typically non‑linear (doubling limits rarely doubles premium). Across broker markets, expect the following indicative relationships for a low‑hazard sole proprietor:

• $1M limit: often ~10%–25% below the $2M price.

• $5M limit: often ~1.5×–2.2× the $2M price. Many buyers reach $5M using an excess/umbrella layer to keep the cost per additional million modest.

Why non‑linear? The marginal probability of very large losses is lower than that of routine losses, so additional layers are priced more efficiently. Industry explanations of this effect are common in broker literature; raising CGL limits increases premium by less than proportionally and umbrella layers price per‑million add‑ons efficiently. (See other broker or industry literature for illustrative examples of the “cheaper per extra million” pattern.)

Quick calculator (illustrative only)

Use the anchored $2M monthly premium within the benchmark range and apply deltas to visualize spend. Example for a low‑hazard sole proprietor in 2025:

• If you’re quoted $45/month at $2M:

• $1M estimate: ~$34–$40/month.

• $5M estimate: ~$68–$99/month (often implemented as $2M primary + $3M excess).

These are not quotes; real pricing depends on your class and risk profile. Summit shops multiple insurers and curates terms.

Provincial taxes on CGL premiums: what shows on the invoice (2025)

Insurance premiums are generally exempt from federal GST/HST as a financial service; you should not see GST/HST applied to the CGL premium line item on your invoice.

Buyer‑paid provincial taxes vary by province. Quebec is intentionally excluded from this page.

Important: Provinces also levy taxes directly on insurers (e.g., BC IPT, AB IPT). Those are borne/paid by the insurer and typically are not itemized as a separate provincial sales tax on your premium invoice.

Example monthly invoices (2025)

Assume a low‑hazard sole proprietor quoted $45.00/month for $2M CGL.

• Ontario invoice example (RST applies)

• CGL premium: $45.00

• Ontario RST (8%): $3.60

• GST/HST on premium: $0.00 (financial service exempt)

• Total due: $48.60

• Alberta invoice example (no buyer‑paid PST/RST)

• CGL premium: $45.00

• Provincial sales tax on premium: $0.00 (no PST; insurers pay IPT separately)

• GST/HST on premium: $0.00 (financial service exempt)

• Total due: $45.00

Why some quotes sit above or below the anchor

Expect meaningful movement versus the ranges above if any of the following apply:

• Higher‑hazard class (e.g., construction trades, hands‑on work at third‑party sites), U.S. operations, or contractual endorsements (waivers of subrogation, primary/non‑contributory wording).

• Revenues, payroll, and subcontracting scale (CGL rating frequently references receipts/exposure base).

• Claims history or adverse loss runs.

• Need to include products/completed operations for certain industries.

See context on rating factors from major Canadian commercial insurance brokers and industry benchmarks.

Working with Summit (broker model and transparency)

• Independent brokerage: Summit compares terms and pricing across multiple insurers to curate fit‑for‑purpose coverage.

• Compensation transparency: how commissions/fees work and when client‑paid fees may apply is disclosed up front.

• Claims support: Summit coordinates with insurers and adjusters to simplify the process.

Source index (pricing and tax references)

• Canadian small‑business CGL cost benchmarks from leading industry sources.

• Non‑linear limit pricing and umbrella context: see broker commentary and industry guides on limit increases and excess layers.

• Provincial tax treatment on premiums: see Ontario, Saskatchewan, BC, and Alberta government sources, and CRA guidance for GST/HST exemption on financial services.

Quick FAQ (2025)

• Are these numbers quotes? No—use them to orient expectations; Summit will obtain live quotes for your class, location, and contracts.

• Why anchor at $2M? It’s a common contractual requirement and widely available at small‑business price points per Canadian brokers’ benchmarks.

• Do I pay GST/HST on CGL premiums? Generally no; insurance premiums are GST/HST‑exempt financial services. Some separate service/admin fees may be taxable when charged—your invoice will itemize if applicable.

• Why is Quebec excluded here? Per Summit’s publishing constraints, Quebec is excluded from service‑area examples on this page.