What General Liability Insurance Covers

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As a business owner, it’s important to protect yourself from potential lawsuits or claims made against you or your business. One way to do this is by having general liability insurance. General liability insurance can protect you from financial losses due to property damage, bodily injury, and other types of lawsuits. In this article, we’ll discuss what general liability insurance covers and answer some frequently asked questions.

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What is General Liability Insurance?

General liability insurance, also known as commercial general liability (CGL) insurance, is a type of insurance policy that provides coverage for businesses in the event of lawsuits or claims made against them. It typically covers property damage, bodily injury, personal injury, and advertising injury.

General liability insurance is often required by law or by contracts with clients or vendors. It can provide financial protection to businesses in the event of a lawsuit or claim, which can be very expensive to settle without insurance coverage.

What Does General Liability Insurance Cover?

General liability insurance typically covers a range of incidents and events, including:

Event or Incident
Example
Property Damage
A customer slips and falls on a wet floor in your store, damaging their laptop.
Bodily Injury
An employee accidentally spills hot coffee on a customer, causing burns.
Personal Injury
You use a competitor’s trademarked slogan in your advertising, and they sue you for infringement.
Advertising Injury
An employee posts a defamatory review of a competitor’s business on your company’s social media page.

It’s important to note that general liability insurance typically does not cover intentional acts or illegal activities. It’s also important to read your policy carefully to understand exactly what is and is not covered.

FAQ

What is Personal and Advertising Injury?

Personal and advertising injury is a category of coverage provided by general liability insurance. It typically includes things like defamation, invasion of privacy, copyright infringement, and other similar claims. For example, if your company’s advertising campaign uses an image or slogan that infringes on someone else’s copyright, you could be sued for personal and advertising injury. General liability insurance can provide coverage for these types of claims.

Does General Liability Insurance Cover Employee Injuries?

No, general liability insurance typically does not cover injuries to employees. However, businesses are typically required to provide workers’ compensation insurance to cover employee injuries on the job.

How Much Does General Liability Insurance Cost?

The cost of general liability insurance varies based on a number of factors, including the size and type of your business, your location, and the amount of coverage you need. The average cost for small businesses is around $500 per year, but it can range from a few hundred dollars to several thousand dollars depending on your specific needs.

Do I Really Need General Liability Insurance?

While general liability insurance is not legally required in all industries, it can be a valuable investment for any business owner. Without coverage, you could be held responsible for expensive lawsuits or claims made against your business. General liability insurance can provide financial protection and peace of mind, allowing you to focus on running your business.

How Can I Get General Liability Insurance?

You can typically purchase general liability insurance from insurance brokers or companies that specialize in providing insurance to businesses. It’s important to shop around and compare quotes from different providers to find the best coverage and rates for your specific needs.

Overall, general liability insurance can provide important protection for businesses against potential lawsuits or claims. By understanding what it covers and considering your specific needs, you can make an informed decision about whether or not to invest in this type of insurance coverage.

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