As a small business owner, getting cost-effective insurance is likely a significant concern. You want to focus on running your business with the peace of mind that comes with knowing any unexpected costs won’t come out of your pocket. However, buying a good insurance policy isn’t always a transparent, simple process, and it’s not always clear what type of insurance you need.
That’s why many look at general liability insurance. It’s considered a foundational policy due to the broad scope of harm, loss, and accidents it can cover. Most business owners bundle other policies with their general liability insurance policy for the best coverage.
However, before you create a tailored insurance plan, knowing precisely what general liability insurance for small businesses covers is essential. That way, you can avoid overlapping policies, understand how much coverage you receive from a general liability policy, and gain insight into why it’s so essential.
General liability insurance for small businesses can cover financial damages due to physical injury or property damage to a third party at your business or as a result of normal operations. Property damage in this context can be confused with damage to the physical building that your business is housed in.
In this case, property damage refers to someone else’s property being damaged. A good example would be if someone hired your contracting business to redo their kitchen and you damaged property in their home. Commercial property insurance protects a business’s physical location in the case of damage.
It isn’t just good business practice to get general liability insurance. It’s necessary. Consider that bodily injury lawsuits have ranged from a passenger suing American Airlines for a case of tinnitus to slip and fall cases like Kroger Co. v Walters. In Kroger v. Walters, the defendant slipped on a banana peel and suffered a severe spine injury.
While the American Airlines case ended in a dismissal, the injured party in the Kroger case had spinal injuries and was awarded 2.3 million dollars. Accidents happen, and whether or not the fault is on your business, it’s important to be prepared to cover the costs.
General liability insurance can help you do that by covering the medical costs of bodily injury and paying the costs of replacing any damaged property. It also covers any legal fees associated with lawsuits brought against you.
Another key group of issues general liability insurance for small businesses covers is advertising injury, tenant liability, and copyright infringement. This includes libel, slander, and even wrongful eviction.
As a business owner, a general liability policy can bring you peace of mind by protecting you in the case of damage to a rented or leased business space.
General liability insurance can also protect you from claims that you have committed defamation against another business owner. Additionally, copyright infringement protections under general liability for small businesses cover financial damages from claims that you’ve taken someone else’s work without permission and used it for marketing purposes.
These types of coverage often come to mind around large, high-profile businesses. Consider musician Dua Lipa’s multiple copyright lawsuits or the Fox News defamation case. While small businesses’ personal injury and copyright cases may not make headlines, that doesn’t mean that this type of coverage isn’t important for your business.
Pro tip: Creatives, including tattoo artists, authors, and journalists, are often involved in copyright lawsuits – so take note if that’s the type of small business you own.
Ultimately, it’s important to be protected and prepared in case of a mistake or miscommunication that leads to legal action.
Product liability is vital if you manufacture, sell, or distribute products. General liability insurance for small businesses covers financial damages resulting from claims of harm or property damage due to your product. Product liability will also cover wrongful death, illness, and financial damages arising from unfinished services.
More specifically, product liability covers these types of product defects:
Product liability functions differently for different businesses. For example, if you sell a lawn mower, your product liability policy will cover injury and property damage due to product defects. If you’re a lawn care service, your product liability policy can cover financial damages due to a claim of incomplete or unsatisfactory services.
Insurance can help mitigate out-of-pocket costs in the case of product liability claims by covering medical expenses, legal fees, property damage expenses, and accident-related fees. There are a few cases that product liability won’t cover, including employee injuries, product recall costs, and issues caused by technology.
As a small business owner, it’s important to remember that many people contribute to a successful product. Manufacturers make the product, distributors help ship it worldwide, and retailers sell it. No matter where you are in that chain, you could be held responsible if something goes wrong. That’s where general liability insurance found through a partner like CoverHound can help.
The question isn’t if an accident will happen; it’s when. With general liability insurance, your business is on its way to comprehensive coverage that gives you peace of mind. Simplify your insurance solutions when you use CoverHound to find general liability insurance.
An online, all-in-one insurance platform, CoverHound allows you to compare rates from insurance providers across the country.
Learn more about how CoverHound’s insurance solutions can help your business!
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