Liability insurance is a must for every business. Liability insurance protects your business from loss should you be liable for damage or injury. However, a single liability insurance policy may not cover every possible type of liability.
The basic liability insurance policy that every business needs to have is called Commercial General Liability Insurance. Commercial General Liability insurance protects your business from financial loss if you are found liable for property damage, or injury caused by your services, your business operations or your employees. It also covers non-professional negligent acts (professional negligence is covered by specific professional liability insurance and is discussed later in this article).
Understanding liability coverage is an important first step in managing liability risks. Commercial general liability insurance includes three different parts as listed below.
Coverage A: Bodily Injury and Property Damage Liability
Bodily injury and property damage coverage provides protection against losses from the legal liability of policy holders for bodily injury or property damage to others arising out of non-professional negligent acts or for liability arising out of their premises or business operations. Mental injuries and emotional distress can be considered bodily injuries, even in the absence of physical bodily harm.
Coverage B: Personal and Advertising Injury
Personal and advertising injury liability protects a business against liability arising out of certain offenses, such as: libel, slander, copyright infringement, or malicious prosecution. This can also cover you against claims arising from appropriating another’s advertising idea or from false arrest or invasion of privacy.
Coverage C: Medical Payments
The coverage for medical payments includes payments for injuries sustained by a non-employee caused by an accident that takes place on the policyholder’s premises or when exposed to the policyholder’s business operations, such as an injury caused by the policy holder’s products or services. Medical payment coverage can be used without having to initiate legal action and T allows you to promptly settle smaller medical claims without litigation. In addition, medical payments coverage includes necessary and reasonable medical, surgical, ambulance, hospital, professional nursing and even funeral expenses for a non-employee injured or killed in an accident taking place at your place of business or as a result of your business operations. Medical payments is a no-fault coverage.
Purchasing Commercial General Liability Insurance
You can purchase commercial general liability insurance as a stand-alone policy, as part of a Business Owners Policy (BOP) or as part of a Commercial Package Policy (CPP). Depending on your policy limits and type of business, you may also want to consider adding a commercial umbrella policy to supplement this liability insurance. The commercial insurance specialists at Roper Insurance can help you determine what type of coverage is right for you.
Additional Liability Coverages to Consider
Depending on your type of business, you may want to consider additional liability coverage that is not part of your commercial general liability insurance. There are several different types of liability insurance that cover specific business operations. Some of the more common liability coverages may include:
This insurance protects past, present and future directors and officers of for-profit or nonprofit companies from damages resulting from alleged or actual wrongful acts they may have committed in their positions.
This insurance protects your business against loss or damages as a result of a patron of your business becoming intoxicated and injuring himself or others.
This insurance protects against unforeseen pollution hazards that may lead to bodily injury, property damage or pollution clean-up costs.
This insurance covers data breaches, computer system failures, damages from your server to others’ computer systems, and intellectual property rights, including libel, copyright or trademark infringement.
This insurance protects against wrongful termination, discrimination or sexual harassment suits from your current, prospective or former employees.
Professional Liability Insurance
This insurance protects professional personnel against negligence claims made by their patients or clients. Some professionals who need to consider purchasing this insurance are doctors, attorneys, accountants, architects and designers, photographers and other creative professionals
Every business has different liability needs. This is by no means a complete list; these are just the most common and often-requested liability coverages. Depending on your business needs there may be a specific liability coverage that will best fit your business operations. For a free insurance review to make sure your business is properly protected and you have the right coverage for your business, contact our commercial insurance specialists today at [email protected] or 303-721-1145.