Today, a spilled cup of coffee or the twist of a knee on your property can result in a lawsuit. As a business owner, you need to be keenly aware that what appears to be a minor incident could result in a big legal problem.
General liability insurance, property insurance, and worker’s compensation insurance are a must to be in business. General liability insurance will protect the assets of your business in the event it is sued for something perceived (right or wrong) to have done to injure or cause damage.
General liability coverage can be purchased as part of a business owner’s policy or separately. A business owner’s policy will package the liability with the property insurance. Sometimes, when part of a business owner’s policy, the liability limits could be fairly low.
Make sure to review and assess risk with your commercial insurance agent. Keep in mind what can be your perceived risk, like operating a lot of heavy machinery or have a fleet of vehicles on the road. How does it differ from other businesses you know? Look to trade associations, the state department of insurance and your agent for guidance regarding damage awards in your state as well.
The general liability coverage will include legal fees and damages in a covered claim and/or lawsuit. Bodily injury, property damage, personal injury, and general damages are normally covered. Punitive damages are usually not covered as they are awarded when it is determined the act was intentional.
In addition, your policy will spell out maximum coverage and limits during the policy period. It may make sense to purchase a commercial umbrella policy to cover additional risk. Review the limits and work with your commercial to determine what is best for your business.