If you own a business, you have probably been told a thousand and one times that you need general liability insurance. In fact, some employers, contractors, or clients may require you to carry this type of coverage before you can work for them. The world of business insurance may seem confusing, but it need not be. Read on to better understand what this protection is, why you, as a business owner, need it, and the costs involved.
What is General Liability Insurance coverage?
Liability protection, also known as commercial general business liability, guards a company’s assets and pays for obligations such as medical costs should someone get hurt on your property, or when there are property damages or you or one of your employees accidentally injures someone while working. There also are several other ways this type of insurance covers your business assets.
Should you be sued, this type of coverage pays for your legal defense costs and any settlement or award should the plaintiff win the suit. Such settlements and awards typically include compensation, nonmonetary losses of the plaintiff, and punitive damages. If you have a general liability policy, these expenses, which can be huge, do not have to come out of your pocket.
Rented property damage
If you rent a property and inadvertently cause damage to it, such as a fire or other covered losses, this coverage protects you from liability as a tenant.
Ideas and expression
Commercial general business liability also covers claims of misleading or false advertising as well as charges of libel, slander, and copyright infringement.
Carrying business insurance is a best practice. These types of protection may not seem to matter now, but when you need them, they become vital components in guarding your business’s very survival.
What’s the right insurance policy for your business?
Depending upon your type of business, another kind of coverage called a business owner’s policy might be a good choice for you. For example, if you are a graphic designer, you do not need the same type of protection that a general contractor does. A general business protection package may be adequate, as it bundles liability and property insurance in one package.
If you are interested in business owners’ policies, be sure and check the liability coverage limit. Since this type of coverage is a bundle deal, some of these sorts of policies have low payout thresholds. In that case, for adequate protection, you would need to purchase an additional policy.
Do you need a general liability insurance policy?
No matter what type of business you have, the fact is that we live in a litigious society. Even though a lawsuit may seem far-fetched, a solid general business liability policy is an investment not only in your business but in your peace of mind. If you were sued and you did not carry this protection, you could face being responsible for paying thousands or even millions of dollars in legal costs and settlements out of your own pocket.
How much is general liability insurance?
In general, business liability policies range in annual premium, depending on your line of business and your coverage needs. This makes the general liability insurance cost much less than budget-breaking amounts you might have to pay out for defense and settlements in the event of a lawsuit.
There are many factors that depend upon the cost of liability protection.
• Your business type
• Your location
• The level of risk your company is exposed to
• The number of employees you have
If your business is on the higher end of the risk spectrum, in addition to general liability insurance, you may want to consider additional protection known as excess insurance or an umbrella policy that increases your coverage limits.
An experienced agent can explain the different types of liability policies and what they cover then make suggestions about which options may be best for you. Just one lawsuit could devastate your business. Planning for all contingencies is good business sense, and liability insurance gives you one less thing to worry about.
What factors should you consider when looking for liability insurance?
There are four steps to buying general business liability insurance.
Assess your risks
Consider what types of accidents, natural disasters, or lawsuits your business could face. You want to make sure you have covered every aspect of your business.
Find a reputable agent
Commercial insurance agents can help you choose the best policy for your needs, but be sure to find one who is interested in protecting your interests with the best coverage
Costs and packages vary widely, so it is wise to compare policies, rates, benefits, and terms from several different insurers.
Re-assess every year
Your liabilities change and grow just as your business does. Any changes in your operations, such as expanding and purchasing or replacing equipment, mean that you should check with your agent to discuss how these alterations affect your coverage.
General liability insurance makes good sense for any business, and today, it is more than wise planning. Good coverage is a matter of survival.
What other types of coverage should you consider for your business?
In addition to general liability insurance, you may need other types of coverage. For example, if you have employees, most states require that you carry workers’ compensation insurance and state disability protection. There also are several other types of policies that your business may require.
• Auto insurance
• Home business insurance
• Product liability
The kinds of protection you need to operate legally and in a fiscally responsible manner depend upon your business type. A professional agent can help you choose the best options, both for your business and your budget.
We have you covered
Choosing the right general liability insurance for your business is as important as an office and equipment for daily operations. However, with so many choices, the world of liability coverage may seem bewildering.
Let RBS simplify the process of protecting your livelihood by answering your questions and explaining the various policy options available. Contact us today for clear, concise explanations and help to choose the right insurance for your needs.