What Does Business Liability Coverage Mean?
It’s crucial to have robust Business Liability Coverage to protect your business from costly lawsuits and third-party claims. Whether you’re a freelance contractor, a consultant, or a retail business owner, you must enact a plan in case of significant liability. But what exactly is Business Liability Insurance? What does it cover, and when do businesses need one? Let’s talk about it.
What is Business Liability Insurance?
This policy protects businesses, regardless of size, against legal claims, including lawsuits by customers, employees, or third parties who allege that the business caused them harm, injury, or damage to their property.
The insurance can cover a range of costs, including legal defense, settlements, and judgments that a business might have to pay, as well as medical expenses from injuries caused by the business’ products or actions.
Moreover, if a customer gets injured on your business premises, you may still be held responsible even if you’re not at fault. That’s why certain types of insurance, like general liability, are highly recommended, especially for those with frequent visitors.
General liability insurance is also essential for businesses that lease their commercial space because it offers protection against liability stemming from damages caused by events like fire, mold, or floods.
The Different Types of Business Insurance Policies
Aside from General Liability insurance, many other insurance policies are available for businesses, each designed to address specific risks and potential losses. The most common types include professional liability insurance, product liability insurance, business income insurance, and commercial liability insurance.
Professional liability insurance covers claims against businesses that provide professional services for negligence or errors made while providing those services. Likewise, Product liability insurance protects your business from liability claims resulting from damage or injury caused by your products. Business income insurance helps businesses cover lost income due to a covered event that disrupts normal operations. Meanwhile, commercial liability insurance protects business property, whether it is an owned or rented entity.
Other policies your provider may offer are Commercial Auto Insurance, Employer’s Liability Insurance, Cyber Liability Insurance, and Commercial Umbrella Insurance.
When Do Companies Need Business Liability Insurance?
Business liability insurance requirements vary by state, but generally, coverage is necessary for the following situations:
- Signing leases for commercial property
- Providing accounting services
- Obtaining a liquor or real estate sales license
- Practicing medicine or dentistry
- Fulfilling contractual obligations with other companies
- Complying with state laws for workers’ compensation or commercial auto insurance
What is the Cost of Business Liability Insurance?
The cost of coverage for business liability insurance varies based on the level of perceived risk. For instance, a building contractor dealing with heavy equipment and dangerous machinery will pay more for coverage than an accountant working behind a desk.
To save on costs, businesses in lower-risk categories can opt for a business owner policy (BOP) that offers general liability and property insurance at a more affordable rate. Additionally, any new or additional liability insurance policies should have exclusions clauses to prevent duplication of coverage from other insurance providers, thereby reducing costs.
About Daniels Insurance, Inc.
At Daniels Insurance, Inc., we have a unique understanding of the risks that businesses like yours face on a regular basis. With the backing of our comprehensive coverages and our dedication to customer service and quick claims resolution, your business will be fully protected. For more information, contact us today at (855) 565-7616.