Coverage Overview – General Liability
Coverage Overview – General Liability
General Liability is an important coverage for any business. It is written standalone or as part of a package policy with other coverages such as Property Insurance. Without General Liability Insurance coverage, any lawsuits against the company will have to be paid out of pocket. For a small or medium-sized business, this could be a financial disaster.
General Liability protects your business from property damage and bodily injury claims that stem from your normal business operations. It provides third-party coverage, which means it responds to lawsuits from those who are not employees such as your customers, vendors, landlord, customers, etc. Your General Liability policy will cover the legal expenses and settlement amounts, up to your policy limits, rather than having to pay for them out of pocket.
What does General Liability Cover?
General Liability provides third-party coverage, which means it responds to lawsuits from those who are not employees such as your customers, vendors, landlord, customers, etc. The coverages that General Liability Insurance covers are:
· Bodily Injury and Property Damage Liability
· Products-Completed Operations
· Personal and Advertising Injury
· Damage to Premises Rented to You
· Medical Payments
Bodily injury and property damage liability covers third-party claims for bodily injury or property damage. Bodily injury can also be non-physical including emotional distress or any mental injury. Examples of bodily injury claims are if a customer slips on a wet floor, or an employee drops a box on a customer’s foot. A property damage example is a painter whose ladder slips and breaks a window.
Products – completed operations is another part of General Liability and is broken out into two coverage. If a product that you distribute, sell or manufacture causes illness or injury, it is covered under Products-completed operations. Examples are food poisoning from undercooked food, or if a rock was mixed in with beans and a customer broke a tooth. Completed operations coverage is protection and your work or services that are faulty and there is injury or property damage after the workmanship or work is complete. An example is if a flooring company does not properly install the floor and the day after the job is done, somebody trips on loose tiles and is hurt.
Personal and advertising injury provides coverage for third-party liability claims such as
Damage to premises rented to you provides coverage for damage arising from fire to premises that you rent and for damages that are not caused by fire for premises (or the contents) rented for seven days or less.
Medical payments provide no-fault limited coverage for payments for injuries on the insured’s location or due to the business operations of the insured.
What is not Covered by General Liability?
· Injury to employees, which is covered by Workers Compensation coverage
· Professional mistakes, which is covered by Professional Liability or Errors and Omissions Insurance
· Damage to property that you own, which is covered under Property Coverage
· Employee Dishonesty
· Discrimination and harassment claims by employees, which is covered under Employment Practices Liability Insurance
· Cybercrime and data breaches, which is covered by Cyber Liability Insurance
· Claims relating to autos you own, which is covered under Business Auto Insurance
Your coverage limits depend on what your risk exposure is and what contractual requirements you have. Some businesses have contracts that require them to have specific limits in order to do the job or have a business relationship with that company. If you have limited exposure, then smaller limits might be okay. If your exposure is high, then you should have higher limits to ensure that you are not paying out of pocket for any lawsuits that are larger than your limits of insurance.
We can write General Liability monoline or as part of a package and our agents would be happy to discuss your risk exposure to help ensure that you have adequate coverage. We can also quote a variety of limits, so you can see your options.
We also can help write the coverages that General Liability will not cover, such as Liquor Liability, Business Auto, Workers Compensation, EPLI, Professional Liability and more.