The startup insurance checklist

Buy at milestones, not all at once

Startups rarely need a full insurance program on day one, and buying coverage without a driver wastes runway. The useful pattern is milestone-driven: each stage of company-building creates a specific requirement, and each requirement points at a specific line. Working through the milestones in order produces the program a diligent broker would design, without paying for it early.

Risklytics is a Y Combinator company, Summer 2026 batch, and batchmates ask whether the accelerator itself requires anything. It does not, in the way a lease or a term sheet does. A YC or accelerator company usually needs D&O at the first priced round and general liability at the first lease, and nothing before that.

The milestones below apply to any startup. If your product is a robot on a customer's floor, an agent acting inside a customer's systems, or a drone over a utility's lines, the same milestones arrive earlier and the certificate gets demanded before anyone lets the machine through the gate. That difference gets its own section further down.

The milestones and what they trigger

The first office lease triggers general liability, because the landlord requires a certificate before you sign, and often property coverage for your improvements and contents. This is usually a startup's first insurance purchase.

The first employee triggers workers' compensation, which is legally required in most states and carries steep penalties for going without. Many states count part-time roles. Founders and officers can often exclude themselves, but that is a per-state election worth making deliberately.

The first customer contract triggers tech E&O, and cyber if the product touches customer data. This is when your product's failure starts having someone to owe, and enterprise contracts frequently make both coverages a signing condition. Buying before procurement asks keeps insurance off the deal's critical path.

The first priced round triggers directors and officers coverage. Term sheets commonly require it as a closing condition, and some set a deadline for binding it after closing. Incoming board members expect it before taking the seat. It protects leadership personally when suits name them over decisions running the company.

The first enterprise deal or big site deployment triggers an umbrella policy, when the contract demands liability limits above what your primary policies carry. One umbrella limit can sit over several underlying policies, which costs less than raising each one.

What the program costs at seed

We do not publish premium figures of our own, because a robotics or drone company's general liability is priced on the machine and where it operates, and no published table captures that. One sourced figure exists for the line every priced-round company buys. A venture-focused startup insurer's cost survey published 2026-05-21 put the median D&O premium across its startup customers at $6,300, with a range of $3,000 to $16,800.

That figure describes ordinary software startups. The D&O number travels reasonably well to a hardware company, because D&O is priced on the round, the balance sheet, and the board. The liability and E&O numbers do not travel, because the underwriter is pricing a machine around people or a model making decisions in someone else's systems. The drivers there are revenue, headcount, where the machine works, the limits a contract demands, and how legibly the safety case is written up.

Certificates and the forms behind them

A certificate of insurance is a one-page summary proving coverage exists: lines, limits, dates, and who is named. When a landlord, customer, or site owner asks for a COI, they are usually also asking for something in the fine print, most often to be named as an additional insured on your liability policy.

Certificate requests have turnaround time, and a program placed in advance turns each one into a short broker task. The requirements in a contract's insurance clause are negotiable like everything else in the contract, and it is cheaper to negotiate a limit than to buy one you don't need.

The checklist above applies to any startup. Companies whose product is a model, an agent, or a machine carry one extra burden: the standard forms behind each line were written before their product category existed. Insurers began adopting AI exclusions for general liability in January 2026 (Independent Agent magazine, 2025-10-21), and generic applications have no fields for autonomy. For these companies, which form gets bound matters as much as which lines get bought, and the forms have to be read by someone who knows what to look for.

How to run the checklist

Tell your broker which milestones have passed and which are scheduled, including the lease under negotiation and the round in progress. That list is most of the application. We ask what you build and where it operates, in plain English, and place each line with an insurer that writes that kind of machine or model on purpose.

Buy each line a few weeks before the milestone needs it. A general liability placement for a company with a robot on a customer's floor takes longer than one for a software company, because fewer insurers want it and the ones that do ask questions. A lease or a pilot delayed by a missing certificate is an expensive way to learn that.

This page describes coverage in general terms. It is not an offer of insurance, and carrier appetite, policy wording, licensing, and availability govern every quote and every claim.