General Liability Insurance

If you want to reduce the chance of losing your business in the event of an accident, you need general liability coverage as part of your business insurance policy. In fact, this coverage type is considered among the most important aspects of business insurance, because it is relied on so often by companies in every industry. After all, there is always a chance you will be sued to pay for damages related to accidents for which your business is somehow responsible. In general, commercial liability insurance covers bodily injury, property damage, medical bills, and personal injury.

Bodily Injury Coverage

No matter where your business is located or what type of products you sell, there is a chance that customers will injure themselves. When that happens, they have the right to bring a lawsuit against your business, which could lead to you losing your business assets. That’s because you will usually be expected to pay for the medical bills of any person who is hurt on your property or injured by your products. Whether someone breaks a bone after slipping on the floor at your business or becomes ill after using your product, you will be glad to have bodily injury coverage as part of your commercial liability insurance.

Property Damage Coverage

When your business gets blamed for damaging someone’s property, you will be relieved to have property damage coverage. Whether an employee breaks a customer’s possession while providing services in a home or a customer’s car hits a pothole in your parking lot, this part of general liability insurance will pay for the repairs.

Products Coverage

Whether you sell products or services, customers have the right to sue you if they are injured or their property is damaged by what you sell. The products and completed operations portion of your general liability insurance can protect you in the event of a lawsuit. It does this by paying for any medical expenses you owe, as well as any legal costs that result from a lawsuit against you.

Even high-quality products have a chance of injuring customers at some point. If you ever face this problem, you will be glad to have product liability coverage. Whether a customer has an allergic reaction to a product or is somehow injured by it, this part of your general liability insurance will pay for the damages.

Personal And Advertising Injury Coverage

This coverage can protect you from any lawsuits initiated by people who accuse you of libel, slander, or copyright infringement. It will pay for any legal expenses that arise during the lawsuit, whether you agree to a settlement or decide to go to court. However, personal and advertising injury coverage only applies if you did not actually commit the offense you have been accused of, so you will not be covered if you purposely infringe on a copyright or lie to ruin a competitor’s reputation.

Medical Payments Coverage

General liability insurance also covers any medical expenses you might be responsible for after you are found at fault for an injury. This means that if you are ordered to pay the hospital bills of customers who were injured after visiting your property or using your product, medical payments coverage will kick in. This part of your commercial liability insurance will also pay the legal expenses associated with fighting a lawsuit.

Business Premises Protection Coverage

If anyone comes to your place of business and gets hurt, business premises protection coverage will pay for the resulting medical expenses. This includes the bills for the ambulance, hospital stay, and any rehabilitation that may be necessary afterward. This portion of your general liability insurance also covers offsite locations that for which your business is responsible.

Accidental injuries and property damage can happen outside of your office or retail location as well. If customers are injured due to activities your company has in progress at an offsite location, general liability insurance will cover the expenses involved with those accidents as well.

Completed Operations Coverage

If you offer services rather than products, you need completed operations coverage. This important part of commercial liability insurance will protect you if customers claim that your services harmed them or damaged their property. That’s because this coverage will pay for medical bills and legal costs so you do not have to.

General Liability Exclusions

General liability insurance offers businesses protection from an array of liabilities, but like any policy it has exclusions - specific situations or types of claims which will not be covered. Some common exclusions found in general liability policies are:

Intentional Acts: Claims related to deliberate, malicious or fraudulent acts by the policyholder typically aren't covered.
Contractual Liabilities: Liabilities assumed under contracts may often be excluded, as they would have existed even without them.
Liquor Liability: Businesses involved with manufacturing, distributing, selling or serving alcoholic beverages may require a separate liquor liability policy to meet legal compliance.
Workers' Compensation: Employee injuries typically fall within the coverage of workers' compensation insurance and, thus, should not be included as part of general liability policies.
Pollution: Damage or injuries caused by pollutants may not be covered, prompting businesses to purchase an environmental or pollution liability policy separately.
Aircraft, Auto and Watercraft Operations: Damage caused to aircraft, automobiles or watercraft when operated is generally not covered under a general liability policy.
Professional Services: Errors and omissions in professional services may necessitate additional liability (or malpractice) insurance policies.
Damage to Owned Property: Damages resulting from the insured owning, using, or having control of their own property tend to be excluded from insurance policies.
Recall of Products, Work or Impaired Property: Often times the costs associated with recalling a product or work are overlooked.
Loss of Electronic Data: Losses related to electronic data could be excluded and would typically be covered under a specific cyber liability policy.
Terrorism: Damages or injuries sustained as the result of war or terrorism tend to be exempt from compensation.

Companies should carefully assess their general liability policies to understand exactly what risks are covered and which aren't. If any risks that fall outside their policy's coverage gap exist, additional or specialized policies might need to be purchased as needed to fill them in.