The most essential commercial insurance you can get in Texas, whether you’re a general contractor, a mechanic, or any business owner, is general liability insurance.
Your business faces liabilities every day, including claims that you or your employees have caused damage or injury. These claims may be based on fact, or they may be fraudulent, but either way, such claims could ruin your business in one fell swoop!
General liability insurance protects business owners against liability claims for property damage, bodily injury, and advertising liability, which includes such things as false advertising, libel, and slander.
In the state of Texas, four kinds of insurers are allowed to offer commercial general liability insurance. We will look at two of them here.
Commercial general liability insurance policies offered by licensed insurers must have as part of the policy these provisions, which have been mandated by the legislature:
Coverage may not be cancelled by the insurer after 60 days from the effective date of the policy except for the following reasons:
- fraud in obtaining coverage;
- failure to pay premiums when due;
- an increase in hazard within your control that would produce a rate increase;
- loss of the insurer's reinsurance covering all or part of the risk covered by your policy; or
- at any time if the insurer is placed in supervision, conservatorship, or receivership and the cancellation or nonrenewal is approved or directed by the supervisor, conservator, or receiver.
Furthermore, the insurer is required to give at least 60 days written notice of its non-renewal and specify the reason it will not renew.
Insurance that isn’t available through licensed insurers can be placed with surplus lines insurers. In order to write surplus lines coverage in Texas, the insurer has to meet requirements set by the Texas Department of Insurance, and before they sell a policy, the agent has to make a sincere effort to find a licensed insurer who can issue the policy.
For more information specific to Texas general liability insurance, you can go to the Texas Department of Insurance website.