One small mistake could cost your company’s livelihood if you don’t have the necessary insurance
- An injury on your commercial property could lead to lawsuits
- Most small businesses can’t cover these losses
- Investing in general liability insurance protects you and your company
- Consulting an experienced agent ensures you have the correct policy
A small accident that causes a minor injury may not seem important. These incidents happen all the time, and there’s rarely any backlash. However, it can become a significant issue for small business owners, especially if the company is responsible for the injury. In this scenario, the business could end up in court facing a lawsuit. Consequently, your company could be responsible for paying for personal injury, property damage, and medical expenses.
The risk of a third party incurring personal or bodily injury is always present, so small businesses must invest in the right insurance policy.
Here’s a look at what general liability insurance does and doesn’t cover and how it can protect your business if there’s an injury on your commercial property.
What is general liability insurance?
General liability insurance is a type of business insurance that covers certain damages that occur on a commercial property or job site.
This type of insurance offers protection against bodily injuries your business causes. These injuries could include customers slipping on wet floors or in your parking lot during a rainstorm.
General liability policies also cover property damage, such as when an employee backs into a customer’s garage door after installing new fixtures. The policy will cover the cost of repairing or replacing the door in this situation.
Your policy will also cover personal injury, including mental trauma and losses resulting from libel and slander. If a customer sues you because of the actions of an employee, this insurance provides coverage.
Knowing the basics of general liability insurance puts you on the right track toward investing in the ideal policy to meet your needs.
How business insurance protects your company
Expenses add up quickly when you’re responsible for paying damages out of pocket, and your general liability insurance policy might be the only way your company survives a lawsuit.
For instance, your policy will cover property damage claims that can get extremely expensive. You could be responsible for damages when a customer or client’s personal or business property is damaged on your commercial site. Or, you could be responsible when an employee damages customer property when working off-site. These damages can add up quickly, so you must be aware of your exposure when selecting a general liability policy to meet your needs.
Your policy will also cover medical expenses if there’s an injury on your commercial property. For example, a customer could have items that weren’t safely stacked fall onto them from a shelf. If a hospital visit is necessary, you could be on the hook for it. There could be physical therapy appointments, follow-up visits, and other medical expenses.
There are always administrative costs, as every legal document needs to go through a lawyer. These expenses are sometimes overlooked, but a small business can quickly find itself swimming in debt as administrative costs add up after an incident.
Your policy will cover court costs, settlements, and judgments as the situation continues. When a customer sues you and the court awards the customer a payout, it could significantly strain your finances.
Having the right insurance might be the only way you keep your doors open if you’re at fault for an injury on your commercial property. You’ll also want to learn what your policy doesn’t cover so you can fill in the necessary gaps.
Things general liability insurance does not cover
General liability insurance is a must-have for a business owner, but it isn’t a catch-all insurance policy that covers everything. Depending on your business and exposure, there will be some gaps you’ll need to fill in.
Commercial auto accidents aren’t covered under general liability. A secondary commercial auto insurance policy is necessary if your company uses a vehicle fleet, or your employees use personal vehicles for company business.
Employee injuries don’t fall under general liability either. Instead, you’ll need workers’ compensation insurance. In Florida, most companies with four or more employees are legally required to have workers’ compensation insurance.
Damage to your commercial property isn’t covered by general liability. If an accident on your commercial property damages one of your buildings, you’ll need a separate commercial property and business equipment insurance policy to cover it.
General liability does not provide coverage when an employee provides wrong or negligent services to customers. In this situation, you’ll need professional liability insurance to cover damages resulting from non-performance or negligence.
There is a limit on your general liability insurance. Claims above your liability limit won’t be covered, so you’ll need commercial umbrella insurance to protect the company against overages when your base policy is exhausted.
Finally, your insurance doesn’t cover you when illegal acts lead to injury. If you assault a customer on the job site, you’ll be held personally responsible for injuries and damages, and your general liability policy won’t offer any protection.
Knowing your coverage gaps makes it far easier to fill them in and protect your business. Speaking with a professional agent is your best bet because it ensures you understand your exposure and shield your company as best you can.
Getting the policy you need
Researching insurance policies to meet your company’s needs is a challenge, especially if you aren’t receiving expert advice. Fortunately, talking to an experienced agent ensures you’re aware of your risks and allows you to protect your assets.
Avante Insurance offers home, auto, and commercial insurance in Florida. Our agents can walk you through your business liability insurance and help you understand your coverage gaps, ensuring you aren’t leaving anything to chance. Contact Avante Insurance for more information on general liability insurance.
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.