General Liability Insurance Coverage for Small Business – Starting up a business means taking up a whole lot of responsibilities when it comes to your business. Now, one of the most important things to think of when setting up your business is business insurance.
Your business may face lots of risks, such as lawsuits that may damage your business and ruin your business reputation, and no one enjoys that.
To protect your business from these risks, you need to opt for Commercial General Liability coverage. So what is General liability all about, what does it cover, when do you need it as a business owner and what is the cost?
There is no need to worry about the answers to these queries because we are right here to give you all the necessary info you need to know about General liability Insurance.
What is General Liability Insurance?
Once you start your business, you might find your business facing various risks that you did not plan for when you started the business.
You might find your business entangled in lawsuits and other risks, but with the right insurance coverage, you can set your business free from these risks and liabilities.
General liability insurance is a kind of insurance coverage that protects or covers businesses from risks such as legal liabilities like bodily injuries or property damages caused by your products or services.
Commercial General Liability insurance like the one provided by StateFarm can help mitigate the losses you face as a business due to bodily injuries or property damage caused by the products and services your business offers.
What does general liability insurance cover?
This policy provides coverage for losses your business incurred due to bodily injuries to customers and or damage of customers property which may both involve lawsuits.
This insurance covers the losses your business is likely to face due to the effects of these lawsuits. This insurance does not cover employee injuries, auto accidents, and professional mistakes but basically provides coverage for customer injuries, customer property damage, and lawsuits related to both.
Now you need to protect your business against losses that come about due to bodily injuries your customers obtained either on or off your premises. When third parties face damages to their body involving your product or service, they can file lawsuits against you, which may lead to a lot of loss for your business.
So, you need to protect your business from this kind of loss by purchasing General liability insurance coverage.
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Property damage liability
As a small business owner, this kind of loss can lead to your business’s loss because of the costly expenses attached to it. So, you need to ensure you protect your business from lawsuits that arise due to damages inflicted on a third party’s property.
Your business may cause damages to your customer’s property deliberately or unintentionally, and these customers can file a lawsuit against you for such damages. This kind of legal liabilities can lead you to face costly legal expenses or might even ruin your business’ reputation.
No matter how small your business may be, it is still likely to face such losses, and it needs General liability coverage to help mitigate such losses.
When Do You Need General Liability Insurance?
No matter your business’s size, you need General liability insurance coverage to protect your business from damages and losses.
Your business may cause damages to third parties unknowingly and face series of lawsuits for such damages, so how do you handle the losses and expenses that come with these lawsuits if you do not have a general liability insurance for your business? You may be a bit confused about when you need this insurance; well, let’s break it down for you.
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You need General liability insurance when the following happens:
- When your business is legally found responsible for bodily injuries caused to third parties. Now, these third parties might decide to file lawsuits against your business. You need General liability insurance coverage to protect your business from these losses and expenses resulting from these lawsuits.
- There are some contracts or events that may require your business to provide some proof of insurance. In this kind of scenario, you will have to provide proof of insurance; it may be in events like trade shows where companies are asked to provide proof of insurance to participate in the tradeshow.
- You may also need insurance to avoid facing lawsuits that may damage your business’ reputation and lead to the shattering of your business.
- Businesses need General Liability insurance to protect their business assets and for signing necessary contracts. Once you have this insurance backing your business, it can help pay for unexpected lawsuits costs, rental of business space, sign deals with new clients as a result of trust in your business, and avoid business bankruptcy.
- Customers will also have trust in your business since you have insurance backing your business. This means they can be easily compensated when they face bodily injuries or when you damage their properties.
Most businesses that purchase General liability insurance coverage have the following qualities:
- They have a location open to the public
- They handle client’s property
- They rent business spaces
- They interact with people on job sites
- They sell products & services to customers
- They are into business advertising
- They use social media platforms and also have an online presence.
Cost of General Liability Insurance
There are important factors that may affect the cost of general liability insurance coverage for your business. These factors include Coverage limits, Location of business, Industry and risk factors and Number of employees.
General liability insurance may cost as low as $21 per month for small businesses. But the amount you get to pay as an insurance premium may differ from that of another because of the factors we have listed out. Just bear such things in mind when calculating the cost of your business insurance coverage.
General Liability Insurance Coverage Options for Your Small Business
Depending on the kind of business you are running, you may need one of these coverage options or all of them. These coverage options include:
Product liability insurance: You need to ensure that your general liability insurance covers your business against damages or losses caused by the products you sell.
Cyber risk and data breach coverage: If your business has an online presence or operating an online business, you can protect your business against losses resulting from a cyber-attack or data breach.
Professional liability: This is also known as Errors or Omissions coverage, and you can use it to mitigate losses incurred as a result of claims by customers against your professional advice.
There other important insurance coverage your business needs, such as Commercial auto insurance, Equipment breakdown insurance, and of course, General liability insurance.
General liability insurance provides your business coverage for bodily injuries, property damage of third parties, and lawsuits that may arise from both cases.