General liability insurance, also known as “Business liability insurance”, covers any medical damages or bodily injuries, property damage of a third party caused by your product or services, rented premises damage, third party property damages, product liability and advertising injury. This type of insurance mainly protects you or your business from any general claims of a third party.
General liability insurance (GLI) policy or business liability insurance (BLI) policy does not cover any work-related injuries, employee injuries, damages caused by your employees etc.
General liability insurance policy will cover:
- Physical injuries: If a customer is injured because of your product or services, general liability insurance policy will help you cover their expenses. Slip and fall is a common examples of physical injuries. If a customer or third party slips or falls on your premises, they or their slip and fall attorney can try to get a settlement for their loss. If your business somehow causes emotional or mental distress to customers or third parties, it is also considered as a bodily injury and they could sue you or your business. This could be expensive if you don’t have GLI coverage.
- Rented premises damages: If your rented property is damaged by explosion, fire or lightning, General liability insurance will cover your expenses regarding this matter. The landlord, his attorney or insurer has the right to sue you if your business somehow causes damage to his property. But if you have general liability insurance, this will cover all costs.
- Third-party property damages: General liability insurance can also cover expenses of third party property damages. It is applicable when you are liable for the care, custody or control of your client’s property. For instance, if your delivery truck accidentally damages any part of a client’s property or if an employee in your construction business somehow damages any part of your customer’s house, you will have General liability insurance coverage for the expenses.
- Product liability : A general liability insurance policy will cover any expenses that are caused by your product. For example, if a customer is injured or hurt by the side effects of your product, they have the right to demand for their loss. Even if a customer is not able to use your product properly and is somehow harmed by the misuse, they still have the right to sue you or your company. Allergic reaction, choking hazard, suffocation hazard, property damage and physical injuries caused by your products are categorised as product liability. All businesses that sell products should have product liability coverage.
- Advertising or personal injury : Your recklessness in advertising can make you liable for defamation. A class action lawsuit could be filed against you if a third party finds the information in your advertisements misleading. Forceful entry, invasion of privacy, wrongful entry, using another’s copyright, use of another’s advertisement idea, false arrest and malicious prosecutions can be categorized as advertising injury. A general liability insurance will cover your expenses in this kind of situation.
- Reputation harm : Competitive companies or such parties could sue you or your business for reputational harm. This could be caused by reckless advertising, using their marketing idea or copyright violation. General liability insurance will help you cover legal expenses or damage control costs.
