Special Liability Insurance Your Business Might Need
When insuring your business, you will likely need a commercial general liability (CGL) policy
. This coverage will apply to loses to other people that you cause while doing business. However, standard CGL policies won’t cover every type of liability claim. You might need to extend your coverage. What are some of these additional policies?
Your General Liability Insurance
When a business buys liability insurance, it wants to protect itself in case someone sues it. For example, a dissatisfied customer might allege that they got hurt in your business, that you damaged their property or that your business caused them personal harm. The resulting lawsuit might lead to costly legal expenses and settlements. By having liability insurance, you will be able to cover the cost of these allegations. You won’t face a significant financial loss if a challenge occurs.
CGL insurance usually applies to the common risks that most businesses might face. These include third party bodily injuries, property damage or personal injuries (libel, slander, advertising injury). The policy might also apply to injuries caused by products and completed operations.
Additional Coverage Beyond CGL Policies
Though you might have a lot of coverage in your CGL policy, there are many liabilities that don't qualify for protection. Therefore, you might need to buy additional protection, such as:
Cyber liability insurance: Coverage pays when incidents like cyber theft or data losses impact customers. It can help you do remedial work to fix the issue.
Errors & omissions coverage: E&O policies apply to mistakes made by professionals like accountants, or lawyers. It pays when a mistake causes a client a financial loss.
Employment practices liability coverage: Businesses have to follow the law when hiring, terminating and providing reviews. If someone alleges that you have committed acts like harassment or discrimination, then this coverage can help you respond.
Hired/non-owned auto liability coverage: If someone uses their personal car for business, then an at-fault wreck might result in a suit targeting the business. This coverage can help the business pay for the losses. Sometimes, you can add this coverage to your CGL policy. In other cases you might need commercial auto insurance.
There are a variety of specialty liability policies that certain businesses might need. For example, establishments that serve alcohol might need to buy liquor liability coverage.
In some cases, you can get coverage as an endorsement to your CGL policy. In other cases you will have to purchase stand-alone coverage. Speak to your agent about the liability coverage that will best protect your operations. They can tell you how best to get it.
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