WEDNESDAY, SEPTEMBER 23, 2020
When buying business insurance, you’ll have to count general liability insurance among the essential coverage to add to your portfolio. This coverage will make sure your business can compensate others when their losses are your fault. However, you must have general liability insurance that is appropriate for your business’s operations. What factors should you consider when choosing the right coverage?
Understanding General Liability Insurance
Any time you work with a client (or other non-employee) you might accidentally harm them. Their losses might include bodily injuries, property damage or other personal losses. Even if unintentional, harm done to others might still be your legal responsibility to pay. A properly tailored general liability insurance policy will help you compensate them.
For example, if a client slips and falls in your business, then your liability policy might pay for their medical bills, lost income and other losses. With coverage, your business won’t suffer a huge financial blow simply because you must repay someone.
Still, choosing the appropriate policy will involve several considerations. Keep these three items in mind when choosing your coverage. They can ensure you get the right protection.
Get the Right Policy Package for Your Business
Most small business owners get general liability insurance by buying it as part of a business owner’s policy (a BOP). These are policy packages designed to cover essential small business insurance needs.
However, many businesses do not qualify for BOPs. The size of their business or their unique liabilities might make them ineligible. As a result, their liability insurance might need to come from other sources. Larger businesses often buy commercial package policies, also called CPPs. These are insurance packages with more appropriate coverage for large businesses.
Choose Appropriate Policy Limits
You will want to choose general liability coverage that will safeguard your business’s stability. Your policy limits must pay enough to minimize your financial losses in case of a claim. The larger or riskier your business, the more coverage you might need to buy.
Most general liability policies offer at least $1 million in general liability insurance. However, based on factors like your industry, business location, the size of your payroll and ownership status, your liability risks might prove higher. Therefore, you’ll need to adjust your general liability coverage limits appropriately.
Invest in Expanded Coverage
Though general liability insurance is often expansive, it might not cover all liabilities in your operations. Usually, the policy will only pay for third party bodily injuries, property damage, personal injuries or product injuries.
Therefore, you’ll need to increase your policy to get coverage for unique liabilities. In some cases, you can buy policy endorsements to cover unique risks like cyber or employment practices liabilities. You can also buy commercial umbrella insurance, too. This coverage will provide more liability insurance if a claim exceeds the limits of your standard liability coverage.
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