General Liability Insurance Companies: Understanding Coverage and Choosing the Right Policy

As a business owner, there are many risks you face on a daily basis. From a customer slipping and falling in your store to an employee causing property damage, accidents happen. That’s why it’s important to have general liability insurance in place to protect your business from financial loss due to claims or lawsuits. But with so many insurance companies offering coverage, how do you choose the right one for your needs? In this article, we’ll explore everything you need to know about general liability insurance companies, including what coverage they offer, how to compare policies, and frequently asked questions.

What is General Liability Insurance?

General liability insurance is a type of business insurance that provides coverage for a range of liability risks. This can include bodily injury, property damage, advertising injury, and more. In general, this type of insurance helps protect your business from financial loss due to claims or lawsuits filed by third parties.

For example, if a customer slips and falls in your store and sues your business for medical expenses and lost wages, your general liability insurance policy may cover the costs of the lawsuit, up to the policy limit.

Many businesses are required to have general liability insurance by law or contract, such as if you rent a commercial space or work with government contracts. However, even if it’s not required, it’s a good idea to have this type of insurance to protect your business from unexpected accidents.

What Do General Liability Insurance Companies Offer?

General liability insurance companies offer a range of coverage options to protect your business from liability risks. Here are some common types of coverage:

Coverage Type
Description
Bodily Injury
Covers medical expenses, lost wages, and other costs if someone is injured on your property or by your products or services.
Property Damage
Covers damage to someone else’s property caused by your business operations or products.
Advertising Injury
Covers claims of slander, libel, copyright infringement, and other types of advertising injury.
Product Liability
Covers damage or injury caused by products you sell or manufacture. This is often included in general liability insurance.
Completed Operations
Covers claims related to work you have completed in the past, such as a customer claiming that a project you completed caused property damage.

When choosing a general liability insurance policy, it’s important to consider your specific needs and risks. For example, if you run a construction business, you may need higher coverage limits for property damage than a retail store.

How to Choose the Right General Liability Insurance Policy

Choosing the right general liability insurance policy can be overwhelming, but it’s important to take the time to research and compare policies to find the best fit for your business. Here are some tips to help you choose the right policy:

1. Assess Your Risks

Start by assessing your business’s risks and potential liabilities. Consider factors such as the type of industry you’re in, the products or services you offer, the number of employees you have, and the size of your business. This will help you determine which types of coverage you need and how much coverage is appropriate.

2. Compare Policies

Once you have a good idea of your coverage needs, start comparing policies from different general liability insurance companies. Look at factors such as coverage limits, deductibles, and exclusions to find a policy that provides the most comprehensive coverage for your business.

3. Check Ratings and Reviews

Before choosing a general liability insurance company, check its ratings and reviews from other customers. Look for companies that have high ratings for customer service, claims processing, and policy offerings.

4. Consider Cost

Cost is an important factor when choosing a general liability insurance policy, but it shouldn’t be the only factor. Make sure you’re comparing policies with similar coverage limits and deductibles to get an accurate comparison of costs.

5. Work with an Insurance Broker

If you’re overwhelmed by the process of choosing a general liability insurance policy, consider working with an insurance broker. Brokers can help you assess your risks, compare policies, and find the best coverage for your budget.

Frequently Asked Questions About General Liability Insurance Companies

What Does General Liability Insurance Not Cover?

General liability insurance does not cover all types of liability risks. For example, it typically does not cover professional liability (such as malpractice claims), employee injuries (covered by workers’ compensation insurance), or intentional acts (such as fraud). Be sure to read your policy carefully to understand what is and isn’t covered.

How Much Does General Liability Insurance Cost?

The cost of general liability insurance varies depending on factors such as your industry, coverage limits, and number of employees. The average cost for a small business is around $500 per year, but this can vary widely based on your specific needs.

Do I Need General Liability Insurance?

In many cases, business owners are required to have general liability insurance by law or as a requirement of a contract. Even if it’s not required, it’s a good idea to have this type of insurance to protect your business from financial loss due to unexpected accidents or lawsuits.

What Happens if I Don’t Have General Liability Insurance?

If you don’t have general liability insurance and face a lawsuit or claim, you may have to pay for damages and legal fees out of pocket. This can be financially devastating for small businesses, so it’s important to have coverage in place to protect your assets.

Can I Bundle General Liability Insurance with Other Types of Business Insurance?

Yes, many insurance companies offer business owner’s policies (BOPs) that bundle together general liability insurance with other types of coverage such as property insurance and business interruption insurance. This can often be a more cost-effective option than purchasing separate policies.

How Do I File a Claim with My General Liability Insurance Company?

If you need to file a claim with your general liability insurance company, contact them as soon as possible to begin the claims process. You’ll need to provide details of the incident and any relevant documentation, such as witness statements or medical bills. Your insurance company will investigate the claim and work with you to settle the matter.

Conclusion

General liability insurance is an important tool to protect your business from financial loss due to liability risks. By understanding what coverage general liability insurance companies offer, how to choose the right policy, and common FAQs, you can make an informed decision about the best coverage for your business.