Commercial General Liability Insurance is a form of business insurance that protects your business financially against the damages resulting from an accident that is the fault of you, your equipment or any of your employees during the performance of the services offered by your business. It is an often overlooked but essential part of overall insurance coverage for your business.
Let’s assume for a moment that your company has a service that cleans carpets in people’s homes. During the cleaning process, you routinely use a variety of soaps, shampoos, and equipment when performing your job to ensure you leave everything as clean as possible.
Now let’s assume that your commercial carpet shampoo breaks down during cleaning and spews massive amounts of water and cleaning chemicals in all directions. Doing so will cause damage to the building you are cleaning. Legally, the customer has the right to sue you for damage and you are fully liable for the repair costs.
That’s the beauty of liability insurance. If you have good coverage, you only have to pay the deductible that you agreed upon when drawing up the policy. After that, your insurance company will pay the remainder of the awarded damages, as well as all attorney and court fees incurred as a result of the accident if your client sued you for it.
So it might seem like an odd expense because it’s not commonly used, but when something happens, liability insurance seems like the best financial decision you’ve ever made.