A successful business has constant contact with customers, contractors, or business partners. As you interact with any of these groups, something could go wrong, and your business could be blamed for injury or property damage. A smart business has solid business insurance so that when this happens, you have a general liability policy in place to protect yourself.
What’s Covered by a General Liability Policy (GLP)?
A Commercial General Liability (CGL) policy protects your business against several types of liability exposures. The policy compensates for injury or property damage and pays your legal costs when your company is found to be at fault in an incident. Even if you’ve done nothing wrong and a person is injured on your premises, your CGL policy may pay benefits on your behalf.
According to the latest numbers from the U.S. Consumer Product Safety Commission, more than 38.5 million people each year sustain injuries related to a consumer product. Fortunately, your business also receives coverage for any injury or damages related to your company’s products or completed operations with a CGL. If someone is hurt, suffers damage to property, or even claims advertising injury, the insurance company will pay for your defense in court, and you will have coverage up to your policy’s limits.
A CGL policy has three parts that you can review when you get insurance quotes. Part A covers claims for accidental injury or property damage when the business is at fault. Part B pays for personal injury damages such as libel, slander, and violation of privacy. Part C pays medical expenses for injuries on your premises (within 3 years) regardless of fault.
Some Typical GL Exclusions
While you are provided with some valuable protections with a CGL policy, there are several common exclusions. Injuries and damages sustained by employees are not covered by CGL but by a workers’ compensation policy, which covers employee injuries. Similarly, other exclusions apply where there would be duplicate coverage with another business insurance policy. No claims will be paid involving company automobiles, watercraft, pollution issues, or replacement of defective products. There is also no coverage for such things as intentional injury or breach of contract with advertising claims.
Common Endorsement for Your Business
Depending on your business operations and your needs, you may wish to get insurance quotes for some endorsements that can add coverage to your CGL policy. These include:
- Marine policy
- Liquor liability
- Owners and contractors protective liability
- Hired auto and non-owned auto
CGL Policy Limits
Most CGL policies are occurrence-made, which means you have coverage if an incident happened during the policy period regardless of when a claim is made, or suit is filed. You will have coverage up to your policy’s limits. This will be an aggregate limit for Parts A, B, and C, with the exception of products and completed operations coverage which has a separate limit. There are also per occurrence and per person sub-limits on a CGL policy.
A commercial general liability policy is must-have coverage that protects your business from the threat of financial loss should something unforeseen happen as a result of your business operations. Be sure to put this coverage at the top of your list when you shop for business insurance quotes. Browse more insurance topics to learn about the importance of protecting your business.
The information in this article was obtained from various sources. This content is offered for educational purposes only and does not represent contractual agreements, nor is it intended to replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. The definitions, terms, and coverage in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.