Understanding Commercial Liability Coverage

According to the Insurance Information Institute (III), commercial general liability insurance policies protect your business from financial losses resulting from personal and advertising injury claims as well as property damage caused by your business operations, your services, or your employees. These policies also cover injuries that happen on your business premises.

Types of Commercial Liability Coverage

General liability insurance coverage generally comes in two flavors. These include a claims-made policy and occurrence policy. Claims-made policies provide coverage when you face a claim, regardless of when the event leading to a claim occurred. Conversely, occurrence policies provide coverage for claim events that occurred when the policy (was/is) active; they will provide coverage even after the policy has expired for any events that happened during the coverage time.

Commercial General Liability Insurance Policies Coverage

General liability covers a wide range of business-related risks. These include:

• Attorney Fees – Commercial general liability insurance policies typically cover your legal costs as well as all damages if you’re at fault, up to the policy’s limits.

• Property Injury and Bodily Injury – Property damage and bodily injury coverage protect your business from financial losses emanating from legal liability from property damage and bodily injuries caused by non-professional negligent acts. It also covers liability resulting from your business operations or premises. Emotional distress and mental injuries can be considered bodily injuries.

• Medical Payments – Coverage for medical bills includes medical payments for non-employee injuries that are sustained on your business premises or through your business operations is also included in general liability coverage.

• Personal and Advertising Injury – Personal and advertising injury coverage protects your business from the costs of liability resulting from certain offenses like libel, slander, copyright infringement, malicious prosecution, false arrest, wrongful eviction, invasion of privacy, and use of other parties’ advertising ideas.

Commercial Liability Coverage is Not an All-Encompassing Insurance Solution

While commercial liability insurance is regarded as comprehensive business insurance, it doesn’t cover all the risks that your business may face, says the U.S. Chamber of Commerce. For instance, it excludes damage or loss caused by you or your employees, including:

• Property damage and theft
• Automobile accidents
• Work-related injury/illness
• Sexual discrimination and harassment
• Pollution damage
• Negligence

You need a worker’s compensation policy to cover injuries to your employees and a commercial automobile policy to cover automobile-related claims. You need a commercial property insurance policy to cover theft or damage to your property. Moreover, commercial liability insurance also excludes professional neglect, errors, or damage to property under your care. For such risks, you’ll need professional liability coverage for the former and custody, care, and control coverage for the latter.

Commercial general liability will not cover all risks facing your business, but it can protect you from a wide range of situations. It’s an inexpensive way of protecting your business from devastating lawsuits. Our experts at CF&P Insurance Brokers will help you find the right commercial liability policy for your needs. To get started, call us now at (925) 956-7700.

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