Colorado Springs isn't your typical business town. Sure, you've got retail shops and restaurants like anywhere else. But you've also got NORAD buried inside Cheyenne Mountain, three Space Force bases, and over 150 aerospace and defense companies doing work that literally protects the nation. Then there's the tourism side—25.5 million visitors came through the Pikes Peak region in 2024, spending $3.1 billion. If you're running a business here, your insurance needs are anything but standard.
Whether you're a defense contractor, a hotel near Garden of the Gods, or a manufacturing shop supporting the aerospace industry, you need coverage that matches your actual risks. Here's what you need to know about business insurance in Colorado Springs.
What Colorado Legally Requires
Let's start with the non-negotiables. Colorado requires workers' compensation insurance for every business with employees—no exceptions. This covers medical bills and lost wages if someone gets hurt on the job. Given that Colorado Springs is home to manufacturing, construction, and physical outdoor tourism work, workplace injuries aren't hypothetical.
If your business owns vehicles, you need commercial auto insurance. Colorado's minimum requirements are $25,000 per person for bodily injury, $50,000 per accident, and $15,000 for property damage. But here's the thing: those minimums won't go far if one of your drivers causes a serious accident. A single trip to the ER can blow through $25,000. Most businesses carry significantly higher limits, and if you're a contractor working on government sites, you'll likely be required to carry $1 million or more.
Medical professionals need professional liability insurance, and contractors in some local jurisdictions need to meet specific insurance requirements to get permits. The Pikes Peak Regional Building Department, for example, requires Class A contractors to carry $500,000 in liability coverage just to hold a license.
Insurance for Aerospace and Defense Contractors
Colorado Springs brought in $22.8 billion in federal aerospace funding in 2024. If you're one of the companies doing that work, you already know that government contracts come with serious insurance requirements. Most federal contracts require general liability coverage of at least $1 million, and often $2 million in aggregate coverage. You'll also need workers' comp, commercial auto, and potentially cyber liability insurance, especially if you're handling sensitive defense data.
Professional liability insurance (also called errors and omissions insurance) is critical if you're providing engineering, consulting, or technical services. A design flaw, missed deadline, or technical error could lead to a lawsuit that costs millions. Your general liability policy won't cover that—you need professional liability for claims related to your expertise.
And if you're working on or near Space Force installations like Peterson, Buckley, or Schriever, you may need additional endorsements or higher limits. Military installations have strict security and liability protocols. Check your contract requirements carefully, and work with an insurance broker who understands defense contracting.
Coverage for Tourism and Hospitality Businesses
Tourism is huge in Colorado Springs. Visitors now stay an average of 2.7 nights, up from 2.2 nights in 2023, and 68% of them engage in outdoor activities. If you run a hotel, restaurant, tour company, or retail shop, you're dealing with a constant flow of people—and that means constant liability exposure.
General liability insurance covers the basics: a customer slips on your floor, a kid breaks a display case, someone claims your employee was rude and caused emotional distress. It also covers legal defense costs, which can run into the tens of thousands even if you win the case. Most commercial leases require at least $1 million in general liability, and if you serve alcohol, you'll need liquor liability coverage as well.
Commercial property insurance protects your building and everything in it—furniture, inventory, equipment, signage. Colorado weather can be brutal. Hailstorms, wildfires, and winter freezes all pose real risks. If you're in a leased space, your landlord's insurance only covers the building structure, not your stuff. You need your own policy.
For tour operators or adventure businesses—zip lines, ATV rentals, guided hikes near Pikes Peak—you're looking at higher liability limits and possibly specialized coverage. Outdoor recreation comes with inherent risks, and if someone gets hurt, they're going to sue. Make sure your policy doesn't have exclusions for adventure activities, and consider an umbrella policy for extra protection.
The Business Owner's Policy: Your Best Starting Point
If you're a small to mid-sized business, a Business Owner's Policy (BOP) is usually the smartest move. It bundles general liability and commercial property insurance into one package, and it's cheaper than buying them separately. BOPs are designed for businesses that aren't extremely high-risk—think retail shops, small offices, restaurants, and service businesses.
Most BOPs also include business interruption coverage, which pays for lost income if you have to shut down temporarily due to a covered event like a fire or storm. Given Colorado's wildfire risk and occasional severe weather, this isn't a minor perk—it's a financial lifeline.
You can add endorsements to a BOP for things like equipment breakdown, cyber liability, or spoilage coverage (important if you run a restaurant). The key is to talk through your actual operations with an agent who knows Colorado Springs. Cookie-cutter policies miss things.
How to Get the Right Coverage
Start by identifying your actual risks. Are you handling government contracts? Hosting tourists? Operating heavy equipment? Each scenario demands different coverage. Don't rely on minimum requirements—they're designed to be the legal floor, not the smart ceiling.
Work with a broker who understands Colorado Springs' economy. The aerospace and defense sector has unique requirements. Tourism businesses face seasonal swings and high customer turnover. A local broker will know which insurers offer the best rates for your industry and can help you avoid gaps in coverage that could sink your business.
Finally, review your coverage annually. Colorado Springs is growing fast—the metro area's GDP hit $53 billion in 2023, up 4.4% from the prior year. As your business grows, your risks change. Make sure your insurance keeps pace. You don't want to find out you're underinsured after something goes wrong.
