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What is Commercial General Liability Insurance Coverage (And Is It Enough?)

Did you know there is a 40% chance a small business will file a claim with their insurance? This means that having the right coverage is bound to pay off.

Without proper commercial general liability insurance coverage, your company may be spending thousands on legal and court fees. Not sure if your business needs liability insurance or if it is enough? Read on for guidance.

What Is Commercial General Liability Insurance Coverage?

Commercial general liability insurance coverage, also known as business liability insurance, covers a variety of things. Businesses will need this but may also opt for additional coverage for other important costs.

Without general liability insurance, you could be looking at expensive legal defense fees and court costs. You can find the right general liability plan from captive insurance to avoid these costs.

Liability insurance for businesses can cover property damage claims that are against your business. It can also cover medical expenses for a customer who gets injured at your company.

This insurance also covers:

  • Advertising injury claims
  • Administrative costs
  • Court costs
  • Judgments and settlements for certain claims

With this policy, you’ll have coverage limits that you can use to cover your claims. This is why many businesses opt for additional coverage.

What It Doesn’t Cover

For claims other than the ones listed above, you’ll need different types of liability coverage. You can also create a custom insurance plan to protect your business further.

This is what your commercial general liability insurance won’t cover and what you’ll need additional specialty insurance for:

Auto Accidents

While driving to or for work, your employees won’t be covered by liability insurance if they are the cause of an accident. For these claims, you’ll need a commercial auto insurance policy or hired and non-owned auto coverage.

Employee Illness and Injury

If an employee falls ill or becomes injured while at work, a general insurance plan won’t cover it. Instead, you’ll need workers’ compensation insurance to benefit your employees during the recovery process.

Workers’ compensation insurance can cover ongoing care expenses and medical bills. Most states will require you to have this business insurance even if you only have one employee.

Property Damage

If you want to protect your building from property damage, you’ll need commercial property insurance. Although not a requirement, it can save you tons of money if property damage was to occur.

Claims Costing More Than Your Limit

As mentioned, you will have a cap for general liability insurance. If you run into a claim that costs more than this limit, you’ll need commercial umbrella insurance. This extends your liability insurance when you come across pricey claims.

Protecting Your Business With the Right Insurance

Most insurance companies offer commercial general liability insurance coverage, but not every plan will be right for your business.

Doing proactive research on the different plans offered may be time-consuming, but it will be worth it in the long run. With general liability insurance, certain claims are covered under a policy limit.

After reading this article, you may find that you need more than general liability coverage. It is normal to have general insurance along with additional coverages. Keep your business safe by covering all of its needs.

For more articles on business financing, check out our other blog posts.