What You Need to Know About Insuring Your Business in Idaho

Businesses across industries are finding success in Idaho, due in large part to the positive economic climate and growing population rate within the state.

Idaho currently ranks fourth nationally in population growth, witha 1.3% increase from July 2022 to July 2023. What’s more, as of December 2023, state officials reported an unemployment rate of only 3.3%, with almost 943,000 citizens employed across a variety of sectors. These low unemployment rates and high population totals mean there’s money to be spent in Idaho, making it a great place for businesses launching in the area.

“Idaho is a very advantageous location for businesses because you have a continually growing market,” says Jason Viechnicki, Idaho Territory Sales Manager for Central Insurance. “That, plus the cost of living is lower there than in some of the surrounding states, makes it an ideal spot for businesses looking to grow.”

While this profitable economic landscape has drawn business owners of all shapes and sizes to relocate or expand their businesses into Idaho, Viechnicki emphasizes that some unique, state-specific factors set Idaho apart when it comes to insurance.

Here, we outline those factors, why they’re important, and how to navigate them as you launch your business in Idaho.

Factor #1: Fleet Safety and Telematics

Idaho is the fourteenth largest state in the nation, measuring in at over 83,000 square miles. With this size and a growing population, some might assume the state is quite congested. However, this couldn’t be further from the truth. Data shows that there are as few as 19 people for every square mile of land in the state.

So, how does a widespread landscape impact insurance rates? “In Idaho, fleets have to travel longer distances, putting more miles on their vehicles,” says Viechnicki. “And on top of that, driving longer distances means more opportunities for accidents, which leads to more claims, and eventually that’s what can cause a company’s commercial auto rate to increase.”

Factor #2: Severe Weather and Loss Control

While Idaho may not commonly experience earthquakes or tornados like other regions in the Southwest, the cold weather in this state is something carriers note when it comes to insuring commercial property.

“Certain parts of the state get colder than others,” Viechnicki says. “But it’s the risks that come with those temperatures that can be so severe.”

Did You Know: Idaho has some of the coldest regions in the country. The town of
Stanley, for instance, is on record as one of the coldest in the nation.

From the impact cold temperatures have on commercial property itself to the general liability concerns that arise in areas with snow and ice, the weather in Idaho significantly impacts a business’ insurance needs.

“One of the most prominent risks in Idaho is roof damage from snow and ice,” Viechnicki explains. “People always name fire as a huge problem facing commercial properties, which is true, but water damage from melted ice can be just as bad.”

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Alongside physical damage to roofs or walls from leaks, water damage can lead to mold, asbestos, and other “silent killers.”

For these reasons, Viechnicki recommends all businesses in Idaho consider their property coverage limits and ensure they’re investing enough in insurance to cover the scope of potential damages. Having adequate coverage is especially important in the wake of the recent inflation and its impact on the construction industry, as in many cases, the cost to rebuild a property has increased over the last few years.

Similarly, if your business has on-site customers or clients, Viecknicki emphasizes the importance of substantial general liability coverage in case of a slip and fall or other ice-related incident.

“Businesses need to remember to budget correctly for today’s insurance costs. And it’s just as important they make sure they have adequate limits and the right coverages for their business, too.” – Jason Viechnicki, Idaho Territory Sales Manager at Central Insurance

Factor #3: The Rapid Growth of the Construction Industry

According to the Idaho Business Review, the state has doubled its employment in the construction industry since 2011. This 94% growth has brought in almost 30,000 new workers to the field, many of whom have opened their businesses within the sector.

For non-construction businesses seeking insurance coverage in Idaho, the construction sector’s growth has a very positive potential impact with businesses having more access to construction workers than ever. If a business in Idaho experiences a property-related loss, they’ll have an easier time accessing the talent and materials needed to rebuild. This can reduce costs as well as time lost to the construction process—both of which are crucial factors when it comes to getting the business back on its feet after a loss.

This growth can also be very positive for construction companies looking to set roots in Idaho. It indicates a high demand for these services and allows organizations to more easily specialize in the type of construction they prefer, rather than having to work on more generalized jobs because there aren’t enough laborers to go around.

On the other hand, that high demand can lead to desperation when bringing in new talent. As such, construction companies may take on new workers who aren’t as experienced, and train them on the job.

“Contractors are struggling to find qualified, skilled employees,” says Scott Zemberi, Director of Construction Underwriting at Central Insurance. “On top of that, there’s a lot of talent set to retire over the next few years, and workers new to the industry will fill many of those spots.”

While these individuals will certainly become seasoned in the ins and outs of construction, Zemberi explains that their lack of experience can lead to an increased risk of losses. “This creates some concern about a lack of expertise in construction. If things aren’t built up to standard, we could see problems up to six or seven years down the road,” he says.

To combat this added risk, construction companies in these scenarios should consider evaluating their existing builder’s risk policy, and increasing their coverage limits accordingly.

The Central Difference

Whether you’re looking to move your business to Idaho or are evaluating your current commercial policies, we encourage you to contact one of our hand-picked agent partners throughout the state. Enter your zip code here to access the full list of agents in your area.

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