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How to protect your Florida business from lawsuits

Key takeaways:

  • Commercial liability covers costs related to lawsuits for injuries and property damage.
  • It covers events like slip-and-falls, equipment/machinery injuries, contaminated food, and faulty products.
  • Legal fees, medical costs, lost wages, and death benefits are covered by it. 
  • Commercial umbrella insurance includes much higher liability limits.

Neglecting to buy commercial liability insurance means putting your business at financial risk from lawsuits and claims. Commercial liability coverage protects your business from monetary losses relating to injuries and property damage on your premises. What makes this type of insurance so important? We discuss commercial liability in Florida, what it covers, and why you need it to protect your employees and financial investments. 

Commercial liability insurance overview

Unfortunately, your business is exposed to possible lawsuits as soon as you open its doors every morning (whether that’s in person or metaphorically online). Whether someone slips on a wet floor in your office, eats contaminated food in your restaurant, or gets injured by a product you sold, there is always a risk of facing legal action. To avoid being sued over these types of incidents or other damages, you need commercial liability insurance, also known as general liability insurance. 

What’s covered with commercial liability insurance?

Commercial liability insurance can help protect your business from costs related to lawsuits over bodily injury, property damage, and other commercial risks. This type of insurance will generally cover medical expenses for people injured on your property. Without liability insurance, you could pay tens of thousands of dollars in damages and medical payments if someone is injured while visiting or working on your property. 

General liability insurance provides for lost wages of employees or visitors/workers if they cannot work. It also provides death benefits. It can be purchased as a stand-alone policy or as part of a Business Owners Policy (BOP) or Commercial Package Policy (CPP). 

Commercial liability insurance vs. commercial umbrella liability insurance

There are two types of commercial policies available. There is commercial general liability (CGL) and commercial umbrella liability. Let’s explore the differences. 

Commercial general liability insurance is a must-have if you or your employees handle products at your business. It covers accidents and injuries that occur on commercial property. Commercial umbrella policies are similar to commercial general liability; however, they have much higher limits than standard commercial liability policies.  

When deciding between commercial general liability or commercial umbrella, it’s essential to consider the risks involved in your business or industry. Some industries are more likely to be the subjects of lawsuits. Common lawsuit risk factors include: 

  • Your commercial property is open to the public
  • You rent or work on property owned by someone else
  • Vendor contracts that require a commercial umbrella policy
  • A business at high risk of lawsuits

Certain businesses may even need higher umbrella limits to cover legal expenses and medical payments. Also, remember that you may need additional endorsements attached to both forms of coverage to cover other exposures faced by your business (such as equipment or tools). You may purchase riders to cover additional aspects of your business. 

Commercial liability insurance examples

What are some examples of common commercial liability insurance exposures for commercial buildings? Commercial policies may cover the following:

  • Building-related claims: Claims involving property damage or bodily injury on commercial property. Claims may include:
    • Slip-and-fall injuries
    • Faulty scaffolding at a construction site
    • Defective doors/handles/steps in commercial buildings
  • Property damage: Claims involve damage to someone else’s property while they’re on your property. For example, if there isn’t adequate security or emergency exits are blocked, you could be sued. If you’re renting office space to another business, customers could sue you for injuries due to unsafe conditions in your building or on your property.
  • Product liability: Claims are related to bodily injury or property damage resulting from products you manufacture, sell, or distribute. “Products” can include contaminated food, battery acid leaks in a warehouse, and software/hardware products. 
  • Advertising Injuries: Claims related to written content, whether in magazine advertisements or social media posts. They cover:
    • Libel
    • Slander
    • False arrest
    • Copyright infringement
    • Malicious prosecution
    • Using another person’s advertising idea
    • Wrongful eviction, entry, or invasion of privacy

Other types of commercial insurance to consider

You may need to consider other types of commercial policies to protect your business and financial investment. Policies like property insurance, cyber liability, and commercial auto will give you a well-rounded risk-reducing profile. Here are other types of policies to consider: 

Property insurance 

Property insurance covers any space you rent or own, including the building and things like the parking lot, fencing, and signage. It also covers the contents inside of the building, such as equipment, furniture, electronics, computers, and inventory. If you rent/lease office space, the property owner may have a commercial policy covering the physical building. Note: Property insurance usually covers wind damage due to hurricanes/tropical storms, but it generally doesn’t cover flood damage. You’ll need a separate flood insurance policy. 

Business interruption insurance

Business interruption insurance is another type of coverage to consider. It will cover your operating costs and lost income if your business shuts down because of a natural disaster, fire, or flooding (not related to a hurricane/storm). Note: Business interruption usually doesn’t cover shutdowns due to pandemics like COVID-19. 

Business Owners Policy (BOP)

A BOP is designed for small to medium-sized businesses. A BOP combines commercial insurance policies, including:

  • Property insurance 
  • Liability insurance 
  • Business interruption insurance 

Cyber liability

This type of coverage pays for costs related to data breaches or other types of cyber events. If you store, transfer, or use the private data of customers or clients, you should consider cyber liability protection. Small and medium-sized businesses are increasingly vulnerable to cyberattacks and would greatly benefit from having cyber insurance

Workers’ compensation

If you employ one or more people, depending on your industry, you are required to carry workers’ comp in Florida. This policy covers medical bills and lost wages for employees injured on the job. It is a standard policy and protects your employees and your business. 

Commercial auto

Suppose you operate vehicles for business purposes, such as passenger vans or delivery trucks. In that case, you’ll need a commercial auto policy to cover property damage, injuries, and legal fees after an accident. Not having commercial auto insurance could cost you big in the event of an auto accident. 

Avante Insurance and your business insurance requirements 

As a business owner or manager, it’s your job to protect your company from liability and other potential financial disasters. Of course, liability insurance is only one element of business protection. To understand the policies you need, speak to one of our licensed insurance agents.

Avante Insurance can help you secure the right commercial insurance to protect your life’s work. Contact us to talk about your business needs and request a quote. We will ensure you have the right coverage to protect the enterprise you’ve worked so hard to grow.

This blog and website are made available by the publisher for educational and informational purposes only. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.