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Introduction

Running a business is not always smooth-sailing. Now and then, one will face several problems that can negatively affect the business. Looking for ways to protect our assets and lower risks proactively should be the top priority of owners, and one of the best-proven strategies you can put in place is getting insurance for the company. One of the most sought after business insurance types is Commercial General Liability (CGL) insurance.

What is Commercial General Liability Insurance?

CGL or Commercial General Liability is a form of insurance any business needs to have protection from claims that are made by third-party due to physical injuries, damage to belongings, and other reasons that occurred in your commercial property or while you are at theirs conducting business. 

General Liability is also helpful when it comes to lawsuits arising from copyright breach, slander, libel, and more. CGL policy is also known as third-party insurance since you are responsible for damages and injuries sustained by those you do business with. In this case, Third-party includes customers, partners, or a vendor and does not include your employees.

General Liability insurances are not equally made, rather customized depending on your business's size, the types of risks you are facing, and how much coverage you need. A wide range of businesses acquire this insurance by their own will to protect their assets.

When it comes to commercial liability insurance being required by law, most states require specific industries to get one like those in the construction business. It can also be required as a qualifier when getting clients, renting places from landlords, and engaging with mortgage companies. Showing proof of being covered by a general liability business insurance substantiates that your business can deal with lawsuits or covering expenses for injuries, accidents, and property damage.

General Liability Insurance Coverage for Business: What Does ot Cover?

Risks and accidents that involve our customers are always a reality when doing business. May it be a leg injury due to slippery floors in a café damaging the walls of a customer’s house when constructing, each risk we may face can cause us to lose money due to costs for replacement, medical bills, and dealing with lawsuits. We may not know, but such scenarios can be the reason for closing our business once our financial resources are drained. That is the very reason a business must get a cgl insurance to ensure that their financial assets are protected, and an insurance company will pay on their behalf. Like any other policy, each one will have its limits when it comes to coverage. For general liability insurance, it covers any claims made by a third-party like customers, partners, or anyone visiting your businesses apart from employees. Below are the inclusions in a cgl policy:

·         Customer injury Physical injury/ fatality

·         advertising and personal injuries like Libel and slander

·         Customer property damage

·         Products-completed operations

Coverage for customer’s damaged belongings

In any event, where an employee accidentally damages a customer’s property, your general liability insurance will also cover the costs of replacing the item, settlements, or legal costs when faced with a lawsuit.

Coverage for Customer Injuries

A customer might slip, fall, or cut themselves while dining in your property. Whenever this type of risk happens, your gl insurance can cover the cost from seeking medical help legal defense when faced with lawsuits to funeral costs in case of a fatality.

Products-completed operations

This type of coverage offers protection and can pay for the costs caused by fabrication, construction, installments, or any work done by your business that caused harm, injuries, and damage to the customer’s property.

Advertising risks

When it comes to advertising your food business, there may be an instance where you unintentionally copied marketing items from your competitors. In such cases, your policy will cover fees when faced with copyright breach or lawsuits like slander or libel.

To understand general liability coverage better, here are real-life scenarios where businesses were able to get protection from the insurance company.

1. An employee of yours made a contract for fixing the wires of a house, but a week or two later, the wires did not work well and caused a fire.

2. A customer’s cell phone was destroyed by an employee who accidentally spilled the coffee being served. 

3. A business made a poster and included an image that was under copyright, and the photographer sued the business for it

4. A contractor accidentally damaged the expensive flooring of the guest while doing a renovation, and the homeowners demanded the company to pay replacement.

5. A newly-purchased coffee machine from a shop was faulty and caused burns to the customer.

Knowing what your general liability insurance coverage helps you identify what additional policies you need to acquire to fully protect yourself from draining your financial resources when faced with risks and damages. Most businessmen will bundle it with worker's compensation coverage and commercial property insurance for other types of protection needed. 

Who can Benefit from CGL?

All businesses have their fair share of headaches. Each has its unique ways of doing business, but all businesses must take general liability insurance coverage. Some of the top businesses who need this policy are:

·         Small business owners

·         Construction businesses

·         Landscaping contractors

·         Those who offer professional services

·         Realty industry

·         Businesses who offer consulting

·         Food and beverage businesses

·         IT businesses

·         Janitorial and cleaning services

·         Marketing and advertising agencies, and much more.

Business General Liability Insurance Cost

Every business have different general liability insurance cost based on the type of risks they face and how much coverage they need. To know how much money you need to invest in this policy can be acquired by getting a liability insurance quote online or setting up a meeting with your insurance agent or broker. Several factors are considered in giving you the quotation you need, such as:

·         Manpower or number of employees you have

·         credit score

·         sales per year

·         payroll of employees

·         square footage

·         complete details about what services and products you offer

·         location of the business

·         Possible risks that your business may face

·         amount of coverage you think you can buy

·         records of losses

Business liability insurance coverage typically starts at $25 per month for small businesses, $42 per month for medium-sized businesses, and higher for those industries that are high-risk and bigger in size. There are many insurance companies out there offering this type of insurance but again, seek the guidance of an insurance expert to get the best but cheapest liability insurance you can acquire for your business.

For a business to lower the business liability insurance cost, one can save money by bundling the policy with commercial property insurance under a BOP or business owner’s policy. Getting a package deal will increase your security and coverage while decreasing the cost compared to buying each policy needed individually. You may be able to qualify for BOP if you have

·         a workplace or office intended for the business

·         less than 100 employees

·         a revenue of less than $1 000 000. 00 per annum

·         a business that is low-risk compared to other industries

·         a need for business liability insurance coverage for less than 12 months. 

Professional Liability Insurance

Professional liability insurance differs from general liability in terms of coverage. As discussed, general liability insurance coverage includes customer accidents, property damage, and advertising risks. On the other hand, liability professional insurance will offer protection for those who provide professional services over conflicts regarding their service quality. This insurance serves as additional protection for insurance agencies, architects, consultants, healthcare workers, accountants, financial advisors, funeral directors, church council, and law firms. It may help cover the costs from lawsuits, lawyer fees, settlements, trial costs that dissatisfied customers can bring against your professional services.

Contractor Liability Insurance

The construction business is highly-prone for accidents and injuries. Situations like a construction worker destroying a wall while renovating or mishandling materials and equipment are just some of the real-life scenarios where a general liability for contractors aids in you taking control of the liability. An ideal contractor liability insurance must be able to offer coverage against claims and lawsuits by a third-party when accidents, injuries, or damage to property happen while undergoing construction. Contractors are even asked for this type of insurance as part of their requirements before even starting a construction job. This is most common for construction jobs done for the government. Here are the particular situations covered by the policy:

·   Accident Claims: Payment for medical and funeral fees for third-party injuries, accidents, and fatality during construction. Take note that this is not applicable for employees; that will be worker's compensation policy.

·   Copyright Infringement: Your construction design or advertisements the same with competitors can be a room for a lawsuit. The policy can pay for the fees that may arise if sued.

·      Damage Claims: if damage to your customer's property happens during construction, the policy will pay for the repair or replacement. 

·        Product Claims: If the equipment used or established by the company fails or causes damages, the policy can be a source of payment for the costs that may incur.

Going more in-depth, here are the advantages of having construction liability insurance. 

·         The policy will pay for the fees of lawyers and witnesses

·         The policy will cover settlements made outside of court

·         The policy will help pay for the damages after the judgment has lapsed

·         The policy will give you security knowing that protection for your assets and employees are in place

Regarding general liability insurance cost for contractors, this will depend on the exposures, risks, and type of construction you are doing. Of course, most construction jobs are at high risk, leading to higher costs for insurance coverage. Most insurance companies require a down payment and fees charged on a monthly basis to cover a half year to a year worth of premiums. Typically, the policy must be twice or thrice the amount of the construction project.

For ratings, it must be at least B or higher for easier approval of claims. Being rated C by the insurance company is a red flag that your business is not doing well and causes difficulty in getting your claims. You might be thinking that costs for this type of insurance are costly. Still, with proper research and guidance from a broker, you will find cheap general liability insurance for contractors but, at the same providing what your company needs in terms of protection or coverage.

Small Business General Liability Insurance

Small business owners are at equal risks, like other businesses. It is not true that investing in insurance must only be a priority when a company is large. Any existing business must take some time to develop a risk management plan that can protect them any time a threat to their financial stability comes their way. Buying a small business general liability insurance is actually an investment and not considered a luxury. 

General liability plans are not created equal, and knowing what works for your business will give you the right coverage needed and save you from spending more than you should be. So, what exactly is a small business liability insurance? In its simplest form, this type of insurance offers coverage for the cost that might incur if a customer is hurt or injured at your establishment. But small business liability insurance covers more than that. It can cover costs for settlements out of court, personal distress and suffering, penal damages, and compensation in excess of actual damage. For rented spaces, this business liability insurance can offer protection for damages due to fire or explosion. 

While these are the risks covered by small liability insurance, there are circumstances not covered by costs when employees or you encounter an accident in the establishment. Cease of business operation due to natural disasters or employee injuries, employee contention, cyber-attacks, and errors and omissions are other cases not covered by this insurance. These situations are covered by other insurance types that you may buy separately or acquire as an add-on to your business owner’s policy.

Small business General Liability insurance cost is dictated by many factors and the available budget the business has. The risks that you might encounter will be one of the significant factors you need to think about. If your business is high-risk for accidents or injuries, it is a must to get more coverage, and if your business is low-risk, it is better for you if you get reasonably-priced general liability insurance for small business. 

Getting general liability insurance for llc (limited liability company) is essential for small business owners. Usually, An LLC structure provides some personal protection for you, and claims made against your business still affect your income source. Not having the total protection you need can be devastating for the business. This is where general liability insurance is needed, as it will help you manage the claims made by third parties and operate your business well. Without putting a gl policy in place, you will be the one to negotiate claims, hire attorneys, and deal with the costs.

Whenever deciding, you may always think about the money you need to spend. Most of the time, you will get the cheapest general liability insurance small business available but again, think about the several factors that might affect your business. All of the factors need assessment that you will decide and with the aid of your insurance agent or a broker. Through their expert advice, they can match what type of policies best fits your small business.

Food Liability Insurance

Any business under the food industry like cafes, restaurants, food trucks, and the like is prone to risks and negative events that will adversely affect their business. Owners of such businesses will take responsibility for any accident or injury that their consumers may meet while dining in at your restaurant. For you to save yourself the stress facing these problems, you must acquire the proper coverage for your business, known as food liability insurance.  

This type of liability insurance covers the owner from injuries, accidents, lawsuits, customer damage of property, unintentional failure of equipment, advertising risk, and host liquor liabilities that will lead to a financial deficit. Through the food liability insurance policy, you are having the peace of mind that your business assets are well-protected, and this policy is required whenever you need to:

·         Acquire a food business loan

·         Be able to rent and utilize space for your business, kitchen shared-use kitchens, etc.

·    Sell to a broader market of distributors to buy and carry your food and beverage products.

Key Points

Now that you have an idea of how vital business liability insurance is for a new business or a steady one, it is best that you start to make a comprehensive policy that will fit your business well. It is vital to know all the small details to get the right coverage for any adverse occurrences you may encounter unexpectedly. Not knowing the details and spending time understanding your general liability coverage can make you shell out more money than what you actually need. You must know the exact coverages your business needs and take the necessary methods to decrease risk levels and costs.

Once you have acquired the best cgl policy for your business, you are assured that you can survive and continue operating your business if it is affected by lawsuits and settlements. The most rewarding of all is the peace of mind it brings knowing that your assets are protected.

It is best to reach out with your choice of an insurance company about all the ways this type of insurance can benefit your business. You may start by getting quotes and inclusions on your insurance so that you can come up with a sound decision on which to choose. Don't forget to see your broker's help about the claiming process to save you the stress in the future once you need it.

Always understand the possible risks your business may face, and don't forget to include it in your research.