When it comes to commercial liability coverage, there are many things to consider. This is one of the most common insurance coverages that is considered a must for business owners. This policy provides protection from liability claims that may be filed by employees, customers, clients or visitors. Even when all the precautions and preventative measures are used to keep a business process or place safe and secure, something can still go wrong. It could be a mistake by an employee or failure of a safety mechanism. This can result in damages or injuries. The person who suffers the injury or damage can file for monetary claim against the business. This type of claim is covered under commercial liability insurance.
Under this policy, most part of the claim is paid by the insurance company. If an employee causes damage to another person’s property then this policy covers the damages. The money can be used by the claimant to repair or replace their property. Business owners are always advised to have the minimum required general liability insurance. In fact, some types of business insurance coverage are required by the law itself. Anyway, it should be a part of comprehensive business insurance coverage. If the policy is not in place then the business owner has to pay personal money to cover the accident or damage claims.
Claims of this nature are sometimes settled in millions. There is no way a business owner can pay such large damages from personal savings. It can result in permanent closure of business and damage to business reputation. There are different types of general liability policies available. Some policies provide comprehensive coverage while others are very specific about what type of risks can be covered. It all depends on the nature of business and possible accidents or damages in future. This policy can also be a part of comprehensive business insurance that includes worker’s compensation insurance, general liability insurance and business property insurance. Government requires every business to have a minimum of coverage under different types of insurance.
Businesses that are in high risk category need to carry higher risk coverage. Companies that operate in different states need to consult a commercial insurance agent to assess their requirements. The selected policy must meet all the requirements of a particular business. While there are standard policies offered by insurance companies, each business needs some customization to meet its specific requirements. It all depends on the risk factors faced by the business.
Basic general liability insurance protects a business against personal injury and property damage claims. The policy also covers litigation costs related to injury or damage. It must be noted that the policy carries a limit which means the insurance company will pay only to the limit specified in the policy documents. It makes sense to have additional clauses to cover all possible risks specific to a business. Product liability policies provide coverage to product manufacturers. Business owners who think that a simple general liability insurance may not be sufficient should get an umbrella policy. This type of policy provides coverage for additional risks not covered in the general policy.