Business owners are aware of the risks involved with operating a business. A minor mistake could lead to a major lawsuit and jeopardize your entire investment. General liability insurance is designed to protect your business if a disaster arises. Here’s a closer look at how this type of coverage can protect your business in the long run.
Is Purchasing General Liability Insurance Legally Required?
Purchasing general liability insurance is not a legal requirement for most businesses. However, purchasing the coverage will put you in a better position to earn valuable contracts. Adding general liability insurance is recommended if you want to secure a client contract. It’s also a potential requirement if you plan to sign a commercial lease. Adding general liability coverage is also a requirement if you are applying for some professional licenses.
What Does a General Liability Insurance Plan Typically Cover?
General liability insurance covers your business against potential risks related to interacting with someone outside your company. General liability insurance protects your business against customer property disputes, such as a customer getting injured due to slipping on a wet spot at your business or alleging that your products caused them harm. The policy also covers your business against slander, advertising injuries, and issues regarding copyright infringement.
What if I’m an Independent Insurance Contractor?
General liability insurance protects independent contractors by providing protection if you are held liable for injuring someone or causing property damage. Your clients may require you to add this coverage before agreeing to let you work on the project. Many high-risk industries require independent contractors to purchase general liability insurance.
How Much General Liability Coverage Do I Actually Need?
The amount of general liability coverage you need depends on the size of your business, the industry you are involved in, the number of employees you have, as well as other factors. Many businesses opt for at least $1 million in total coverage.
What Are Some Examples of Common Liability Claims?
Some common examples of general liability claims include:
- If a customer gets injured while visiting your property and decides to sue.
- If one of your employees accidentally causes damage to a customer’s personal item (e.g., a smartphone, tablet, etc.) while working on a project.
- An employee makes derogatory remarks about a competitor who sues for slander
How Do I File a General Liability Claim with My Insurer?
Contact your insurer as soon as possible. Your insurer will ask you to provide the name of your business, policy number, and a description of the incident. Your insurer should be able to guide you through the claims process and answer any questions if you need further clarification.
What Happens If I Need to Add Coverage?
It’s a fairly easy process to add more insurance to your policy as your business evolves. However, remember that adding extra coverage to your policy may alter your insurance premiums.
How Does General Liability Insurance Compare with Other Policies?
Many business owners opt to purchase a Business Owner’s Policy that combines general liability insurance with commercial property insurance. This policy is an attractive option if you own a small business. General liability insurance differs from professional liability insurance. General liability insurance offers protection if a third party pursues litigation against you alleging property damage or a physical injury occurred. Professional liability insurance protects your business if you are sued because you allegedly made a serious error on the job that caused financial damages.
Consult With Action Insurance Group
Businesses can rely on general liability insurance as a safety net when things go wrong. If you have questions regarding your policy, contact the team here at Action Insurance Group, and we will assist you.
Comments are closed.