In the United States, nearly 33 million small business owners work for themselves. Since 76.2% of them experienced an event in 2020 that might have been subject to an insurance claim, it appears that they had adequate coverage. Among these policies is general liability insurance, sometimes called company liability insurance. We present a more in-depth examination of general liability insurance here, including its definition, coverage, and the types of firms that might benefit from it.
For What Audience Intended?
By purchasing general liability insurance, businesses can protect themselves financially from claims made by third parties, including customers, who may suffer injuries or damage to their property. Furthermore, it can help to defray the legal expenses associated with defending against such claims.
No matter if they make a physical product or provide a service, most small business owners should get general liability insurance. Danger might mean more than just hurting someone physically. For example, in this context, harm can take the form of harming another person’s reputation. In this coverage, claims of copyright infringement can also be considered injuries.
What is the type of coverage for this policy?
When you get general liability insurance, you’re essentially purchasing financial protection against a wide range of potential third-party claims and incidents. Policies typically pay for customers’ medical bills in the event that they sustain a covered injury, such as a slip and fall on business property. The coverage helps the insurer cover the costs of any necessary medical treatment, relieving the small business of that burden.
The bodily harm policy may also cover injuries customers sustain as a result of using a company’s products. You should carefully examine the policy specifics to determine if a general liability policy includes product liability coverage, as some insurers require separate coverage for certain occurrences.
Similarly, general liability insurance pays for repairs to someone else’s property if you damage theirs. If, when installing a product at a customer’s site, workers were careless and caused damage to the customer’s property, the general liability coverage might cover any claims related to that property.
Additionally, the coverage takes care of cases where a third party asserts claims of reputational harm, which usually manifest as libel or slander. The coverage contributes to the cost of legal representation for the small business, as well as any settlements or judgments that may arise from such representation. Like the coverage for slander and libel, advertising injury coverage typically includes copyright infringement claims and other forms of advertising injury.
In most cases, which claims will not be covered?
General liability insurance can only cover injuries sustained by unaffiliated third parties. Consequently, it will not cover injuries that employees experience on the job. Similarly, general liability coverage will not pay for repairs to a business’s property.
Lastly, professional liability insurance typically covers errors made when rendering professional services, something that general liability insurance typically does not. Cases involving allegations of carelessness or misrepresentation fall under this category. While general liability insurance often covers slander and libel claims, professional liability insurance can also handle these types of claims under specific circumstances.
