Securing general liability insurance for any new small business venture can be an exasperated in task. Understanding some of the basics of this policy can help you as the owner in a procuring the type of coverage that you need and/or desire for your growing business.
The name general liability insurance is fairly descriptive of the type a policy that you would be purchasing. This policy is very general in nature when it comes to covering liability claims. It is not broad in that it doesn’t cover any and all conceivable claims in this area of losses and lawsuits. It might help in your understanding of what is actually covered under general liability insurance if we first discuss some of the many exposures that are not covered.
Typically this policy does not cover any professional liability exposures from claims and losses. Along those lines, errors and omissions insurance coverage would not be included on this policy. Liability from any kind of workers compensation claims would not be covered under this policy. Employment practices liability losses and claims would not be covered under this policy. Even though you are a small business owner possibly you are a director or officer of some profit organization or nonprofit organization and that would also not be covered under this policy.
Basically what would be covered is that of accidental claims and losses from bodily injury and/or property damage incidents. That is the basic type of coverage that is included in the general liability insurance policy. Normally this policy also includes the products that you sell and/or the completed operations and services that you perform. It would be prudent to make sure that these additional coverage are folded into your insurance portfolio. Most of the time this policy does also include a couple other coverage that are included for little or no additional premiums.
One of those coverage is called medical payments coverage. This coverage will provide payments to third parties who are injured on your premises regardless of your liability. If you’re liable, then your general liability occurrence limit will respond, this medical payments coverage responds when you are not liable. This is a Good-Samaritan type of coverage.
The reason for this coverage is primarily goodwill for your clients and also from the insurance carrier standpoint by not hassling over who is at fault sometimes can advert claims and lawsuits that while they maybe bogus it still cost money to defend. Usually the limits for the medical payments typically come in the $5000-$10,000 range, but you can pay for increased limits if you want. There’s usually no valid reason for increasing the limits because you have your liability occurrence limits to protect you for claims that you are liable for. The second coverage that is typically included on this policy is called personal injury coverage. This protects you from unintentional acts of injuring a person that is outside the bodily injury or property damage coverage. This is typically mental anguish or some sort of personal private injury that does not result in physical harm, but it must be unintentional act by you or your company. The last coverage that is typically on this policy is that of advertising injury. Specifically this is covering claims from liable and slander that may arise from your business practices. Intentional acts are not covered unless they are for inadvertent unintentional acts that may libel or slander some third party. As a small business owner when purchasing general liability insurance knowing what isn’t covered and what is typically covered can help you in the purchase of this policy.