General Liability Insurance is essential for all businesses in today’s society where even minor accidents can result in large settlements. Liability insurance protects the assets of a business when it is sued for something it allegedly did, resulting in bodily injury or property damage.
The General Liability policy typically provides liability insurance for the cost of defending lawsuits stemming from:
- Accidents that cause bodily injury and/or property damage.
- Claims such as libel and slander.
- False advertising
*General Liability insurance does not cover errors or negligence from professional services.
Liability insurance can be purchased on its own or as part of a Business Owner’s Policy (BOP) depending on the business size and nature of its operations. Stand-alone General Liability does not typically include property coverage while a BOP package bundles the two together.
Small to medium sized businesses in lower risk businesses classes are usually eligible for BOP coverage. A BOP may be available depending on the type of business, annual sales, number of employees and other factors. Along with the General Liability coverage, the BOP includes property insurance for physical assets, such as contents, that are leased or owned. The package insurance policy may also cover loss of business income and extra expense resulting from a covered loss.
If your business has any of the following characteristics you may not be eligible for a BOP. Characteristics typically not eligible for a BOP policy include:
- Large Premises Operations
- High risk or highly specialized operations
- Majority of business conducted off-premise
- Requires liability limits higher than offered with a BOP
Below are the types of liability coverage typically offered by the General Liability policy:
- Bodily Injury – Liability coverage may pay the affected person or firm for the cost of care, the loss of services and restitution for death that results from an injury.
- Property Damage – In the event your business causes damage to, or causes the loss of use of someone else’s property, property damage coverage may pay for the value of the physical damage to the property; or the loss of use of that property.
- Products and Completed Operations – If an injury occurs due to the use of your products or services provided, the policy would pay for the resulting damages and any legal expenses up to the policy limits.
- Medical Payments – If someone is injured by you or at your business site, the policy may pay for medical and funeral expenses incurred, up to policy limits, within one year of the accident, for example, if a customer tripped and fell on your premises and had to be hospitalized.
- Personal/Advertising Injury – if you are accused of any of the following: Publishing inaccurate information that slanders or libels a person or organization; Publishing material that violates a person’s right of privacy; Falsely arresting, detaining or imprisoning someone; Maliciously prosecuting someone; Wrongfully evicting someone; Copying another company’s advertising ideas or style of doing business; Infringing on another company’s copyright, title or slogan.
- Contractual Liability – this coverage extends to any liability you may assume by entering into a variety of different types of contracts such as a building lease.