Commercial General Liability
Commercial General Liability Insurance
Commercial General Liability Insurance is commercial insurance coverage that is designed to mitigate financial risks to your company. Financial risks can arise from lawsuits and litigation against your business for a number of potential hazards. Commercial general liability insurance, or CGL, pays for damages and claims that come about primarily due to bodily injuries and property damages. Effectively, it keeps your company from going bankrupt due to legal defense bills if a customer sues you.
Commercial General liability insurance protects you from the most common types of lawsuits that can arise from customers or other hazardous events. It’s the most popular type of commercial insurance coverage because it covers all of the most likely events you may encounter.? While your business insurance policy can vary, general liability coverage normally focuses on four specific areas of protection:
Bodily Injury Or Property Damages To Customers
General liability provides your company with legal and financial protection if a customer is ever subjected to bodily injuries at or because of your business. Bodily injuries can include physical injuries such as when a customer slips on a newly waxed floor. It can also include sickness or disease that is attributed to your company, and mental anguish or suffering.
Effectively, anyone or anything that is associated with your company can cause bodily harm to a client or customer. Your office or retail space, your employees, the work you provide and the products you sell. When a customer receives physical harm or damage, your company may be legally liable to pay for those damages.
Commercial general liability provides your business with legal and financial protection if your company is responsible for damages caused to someone else’s property. For example, if one of your employees accidentally punctures a gas pipe while installing a swimming pool and it causes a fire on the customer’s property, your company may be legally liable for those damages. General liability provides protection for property damages that happen on your business premises as well.
Products And Completed Operations
If your company sells products or provides services, the goods and services you provide can put you at risk of legal actions. For example, if your company sells swimming pool water pumps and a pump is found to be defective, your company could be sued by a client if they are injured because of the defective pump. Likewise, if an employee wires the pump wrong when he is installing it, and that results in injuries or damages to your customers, your company can be sued for the damages caused by the operations your employee completed.
Product liability can include defects in your product design. For example, if you produce kitchen knives and one model’s design has a flaw that causes the blade to break and cut customers; your company can be liable for that design defect.
Flaws in production or manufacturing are also covered by product liability. Toys from China for example, have had claims against the manufacturers because of lead paint or unsafe chemical usages in the products.
Improper labels or Instructions can also create liability suits against your company. If you sell a hot cup of coffee for example, and the product is not clearly labeled with warnings about burn potential, a customer may injure themselves when they spill it.
Product and completed operations coverage can pay for the customer’s legal fees, lost income, medical costs and pain and suffering.
Keep in mind that product liability coverage is essential even if your company does not manufacture products. Legal actions can arise from products that you sell, even if you were not the original manufacturer.
Products and completed operations coverage includes products you manufacture or sell and services that you provide, regardless of where you create or sell them, as long as they are not specifically excluded on your commercial general liability policy.