Filed to Business Liability Insurance on Feb 26, 2018
If you are a business owner, you're no stranger to the several types of insurance policies you need to protect against unforeseen circumstances.
Surprisingly, 3 out of 10 business owners admit they don't have a basic business owner's policy (BOP). That's a risky gamble in any game.
A BOP typically includes some general business liability insurance. Does a BOP contain enough liability to cover you under the worst scenario? Probably not.
Here are three basic things you need to know about business liability insurance so you can cover your assets.
General business liability coverage can be a stand-alone policy. It can also be part of your existing BOP.
General liability provides financial protection in case someone sues you or one of your employees.
It also covers you as a tenant should you cause damage to a rental property. Lastly, it covers false advertising, slander, libel, and copyright infringement.
Here are some of the types of claims your policy will cover.
Bodily Injuring occurs when someone is injured at your place of business. Or, they are hurt while performing work elsewhere. One standard example is the basic trip-and-fall.
Your business liability insurance covers that person's medicals costs and lost wages. If the person sues, the policy covers court costs and settlement amounts.
Your liability policy would cover instances of damage to someone else's property.
For example, say one of your employees backs into a customer's garage during a delivery. He destroys the imported coquina siding. Your policy would cover repair costs.
The coverage applies to anything damaged that isn't owned by the business. Also, if the owners of the affected property can't use or inhabit the property until it's fixed, the policy will compensate the owner for the loss of use.
Personal and Advertising Injury
Your business liability insurance covers the cost of nonphysical damage as well. This occurs when your business causes damage through advertising or other activities.
For example, let's say that one of your employees sends a Tweet that your competitor's moisturizing cream causes acne. (Not that anyone would Tweet false facts, right?) Though, there's nothing to back up that claim.
Your competitor can take you to court for slander. Your policy will cover damages, with some exceptions. For example, you would not be covered if your business's intention was to cause harm.
As with any policy, there are limits. Those limits vary per policy. Typically, the policy will not cover the following.
Policies typically don't cover workplace injuries. That's where workers compensation takes over.
Damage to other people's property is covered. Damage to your own is not.
If your driver accidentally runs a pallet through your showroom window, file the claim with your BOP, not your business liability policy.
Understandably, your policy does not cover any damage done on purpose.
Customer's Property in Your Care
Business liability does not cover any damage done to a customer's property while you have it. Other property coverage policies handle this. Talk to your agent for more information.
Business liability doesn't cover professional mistakes. If your business has to reproduce an order because your print guy chose red when the customer specified blue, your policy will not reimburse you.
Finally, this type of policy does not cover damages to your company vehicles. You will need a commercial auto policy to cover fender benders and other damages.
Your general liability policy includes a maximum amount the insurance company will pay for a given claim. You will have to make up the difference.
Work with your agent to increase the coverage limits. When shopping for a policy, be sure to do your research. Depending on your industry, you may need different levels of coverage.
Check Your Business Owner's Policy
You probably already have a BOP. Check it to see how much liability coverage it has. Is it low? If so, you may want additional coverage through a separate general liability policy.
If you are interested in liability insurance, please contact us.