Comprehensive General Liability Insurance

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Comprehensive general liability insurance provides coverage for third-party claims against a business due to bodily injury or property damage caused by the business’s operations, products or services. This type of insurance is essential for any business to protect itself from unforeseen events that may lead to legal liability.

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What is Comprehensive General Liability Insurance?

Comprehensive General Liability Insurance, also known as CGL, is a type of insurance policy that provides coverage for third-party claims against a business due to property damage, bodily injury, or personal injury caused by the business’s operations, products, or services. The coverage provided by CGL insurance is broad and comprehensive, making it an essential policy for any business to protect against unforeseen events that may lead to legal liability.

What Does CGL Insurance Cover?

CGL insurance provides coverage for a wide range of liabilities, including:

Coverage
Description
Bodily injury
Coverage for injury to a person caused by the business’s operations, products or services, including medical expenses, lost wages or pain and suffering.
Property damage
Coverage for damage to property caused by the business’s operations, products or services, including repair or replacement costs.
Personal injury
Coverage for claims of defamation, libel, slander or invasion of privacy caused by the business’s operations or advertising.
Advertising injury
Coverage for claims of copyright infringement, trademark infringement, or advertising liability caused by the business’s advertising.

In addition to the above, CGL insurance may also provide coverage for contractual liabilities, product recall, and liquor liability, among other things.

Who Needs CGL Insurance?

Any business that interacts with members of the public, provides a service or sells a product should have CGL insurance. This includes businesses of all sizes, from small sole proprietorships to large corporations. Without CGL insurance, a business may be exposed to significant financial risks in the event of a third-party claim.

How Does CGL Insurance Work?

CGL insurance policies are typically written on an occurrence or claims-made basis. Occurrence policies provide coverage for claims that arise during the policy period, regardless of when the claim is reported. Claims-made policies provide coverage for claims that are reported during the policy period, regardless of when the incident occurred.

CGL insurance policies typically have limits of liability. The limit of liability is the maximum amount the insurance company will pay for a covered claim. The limit of liability is usually stated as a per-occurrence limit and an aggregate limit. The per-occurrence limit is the maximum amount the insurance company will pay for a single claim. The aggregate limit is the maximum amount the insurance company will pay for all claims during the policy period.

What are the Benefits of CGL Insurance?

There are a number of benefits to having CGL insurance, including:

  • Protection against third-party claims
  • Legal defense costs covered
  • Financial security for the business
  • Peace of mind for the business owner

How to Get CGL Insurance

CGL insurance is typically purchased as part of a business owners’ policy (BOP) which includes property insurance, liability insurance, and business interruption insurance. BOPs are designed for small and mid-sized businesses and provide a comprehensive insurance package at an affordable price.

Alternatively, CGL insurance can also be purchased as a standalone policy for larger businesses with more complex insurance needs.

Conclusion

Comprehensive general liability insurance is a crucial protection for businesses of all sizes. It provides coverage for third-party claims against a business due to bodily injury, property damage or personal injury caused by the business’s operations, products, or services. Without CGL insurance, a business may be exposed to significant financial risks in the event of a liability claim.

FAQs

What is the difference between CGL and professional liability insurance?

CGL insurance provides coverage for third-party claims against a business due to property damage, bodily injury, or personal injury caused by the business’s operations, products, or services. Professional liability insurance, on the other hand, provides coverage for claims of professional negligence or errors and omissions related to the services provided by the business.

Is CGL insurance necessary for small businesses?

Yes, CGL insurance is necessary for small businesses that interact with members of the public, provide a service or sell a product. Without CGL insurance, a small business may be exposed to significant financial risks in the event of a third-party claim.

What is a per-occurrence limit?

The per-occurrence limit is the maximum amount the insurance company will pay for a single claim. For example, if a business has a per-occurrence limit of $1 million, the insurance company will pay up to $1 million for a single claim.

Can I purchase CGL insurance as a standalone policy?

Yes, CGL insurance can be purchased as a standalone policy for larger businesses with more complex insurance needs.

What is a claims-made policy?

A claims-made policy provides coverage for claims that are reported during the policy period, regardless of when the incident occurred. This is in contrast to an occurrence policy, which provides coverage for claims that arise during the policy period, regardless of when the claim is reported.

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