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Business General Liability Insurance

by Admin on October 27, 2011


usiness general liability insurance, also known as a business owner’s policy or a BOP, is a comprehensive policy that protects a company from costly damages in the event that a client is injured on company property or if an owner or employee injures someone or damages property at a client’s locality. In sum, it protects the company’s assets if a suit is filed against it claiming a loss such as injury or damage, even if the claim is fraudulent.

The policy generally covers legal and medical fees, the replacement or repair of damaged physical property, property losses due to theft, and the recouping of monies lost from business disruptions due to catastrophes such as fire. It also covers suits such as libel, slander, disparagement, and copyright infringement. This type of policy will pay for covered incidents up to a predetermined amount specified in the policy at the time of its inception, and it can be purchased as its own policy or it can be added to an existing policy.

Note that business general liability insurance policies do not include errors and omissions protection, or damages claimed as a result of a charge of professional negligence or failure to perform professional duties.

General Requirements for Business General Liability Insurances

Each state’s insurance requirements are different and each insurance company’s policies vary but there are some general items that are typically included in general commercial liability insurance policies. One of these items is called employment practices liability. This covers claims for specific employment-related lawsuits brought against a company by an employee or employment applicant. For instance, if an employee sues a company for discrimination, the company would look to this facet of the general policy for coverage.

Another area is that of tenant’s liability. This protects a business from damage claims and losses due to fire or other catastrophes caused by the company to any rented land, buildings, or other property included in a commercial lease agreement. For example, if a leased building caught fire as a result of an error during daily operations, the company would look to this facet of the policy for coverage to pay the landlord’s repairs or replacements.

Companies should look to their individual insurance representatives for specific coverages tailored to their needs to ensure the best coverage possible. Small businesses benefit the most from comprehensive general liability insurance for small business policies because even the smallest of incidents can result in the large lawsuits, and many small businesses just do not have the monetary means to cope with such claims.

General business liability allows a business to, if found responsible, pay the required costs and still keep assets in order to remain in operation. If not for policies such as this, many companies would be closed down due to financial obligations arising from a workplace injury or property loss. It is much easier for these companies to find money in their quarterly budgets to pay the reasonable premiums for such policies than it is for them to shell out the possible millions required for a lawsuit or settlement.

Minimum Liability Limits

It is important that all businesses carry some type of general liability insurance. In fact, most states require minimum liability limits to be carried by businesses in order to be properly licensed and remain operational. The general liability insurance for business provides protection against injury and property damages, enabling a company to survive through difficult times by still keeping the assets required to operate and stay in business.

It is important that companies find a competent insurance professional who can provide specific information to interested parties regarding state laws, premiums, appropriate coverage amounts, and details of covered situations so that the company can purchase the appropriate coverage(s) for its size and industry.

General insurance policy premiums are normally fairly priced and it is oftentimes easier for companies to free up money from annual budgets to pay insurance premiums at regular intervals than it is for them to pay out a much larger sum for lawsuits or settlements. Although all businesses benefit from these types of policies, it is most important that small companies have adequate small business general liability insurances in the event that a large loss or injury claim be placed upon them, the company will not have to close down to meet the burden.

How Does Business Liability Insurance Work?

In this video Vic Schumacher explains how business general liability insurance work. It is a must see for people who do not have a business liability insurance yet and want more information on it.

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