General Liability Insurance is one of the most important types of liability insurance policies a professional can have in place in order to protect their business. Lawsuits are extremely expensive and can have a long-lasting effect on your business and its reputation. General Liability Insurance not only covers bodily injuries and property damage to third parties, but it can also provide defense coverage against claims related to these incidents.
You may have also heard the phrase: Commercial General Liability
What does General Liability Insurance Cover?
General Liability Insurance helps protect your business from a loss should you be found liable for bodily injury or property damage to a third-party. If you are found liable for any of the above, General Liability Insurance can help cover the costs associated with legal fees or monetary damages due to the injured third-party.
- General Liability Insurance is an occurrence policy, meaning the insured has coverage as long as the covered incident in question occurred while the policy was in-force. In other words, an incident may be covered even if it is reported to the insurance company after the policy expires
Third-Party Property Damage
This occurs when you unintentionally damage or destroy someone else’s property while on the job. General Liability Insurance covers the costs associated with replacing or repairing the damaged property. This can also cover any legal expenses incurred due to this incident.
Here are a few examples:
- If a DJ drops a piece of equipment while setting up at a venue and cracks the floor, they could be liable to absorb the cost for repairs.
- If equipment or studio property is damaged during a fitness class and the studio decided to sue, the instructor could be held liable for costs associated with replacing or repairing damaged equipment.
Third-Party Bodily Injury
Third-party bodily injury can occur when a client injures themselves because of your negligence, either on or off your premises. General Liability Insurance can cover the costs associated with medical bills and lost wages, as well as any fees related to a lawsuit stemming from this incident.
Here are a few examples:
- If someone injures themselves tripping over DJ equipment wires when walking out to the dance floor, the DJ could be responsible for their medical fees.
- If a client slips and falls while following a fitness instructor’s routine, they could be held liable for the medical expenses incurred.
- If a Nutritionist or Registered Dietitian recommends a new food plan, not taking into account their client’s food allergies, and their client gets ill they could be responsible for paying the medical bills.
Medical expense coverage can provide payment for third-party medical expenses, regardless of fault, up to $5,000.
Additional General Liability Coverages (Unless Specifically Excluded in your Policy)
Personal and Advertising injury can occur when an individual accidentally commits copyright infringement or makes a false statement that is considered to be detrimental to another client, or company’s reputation (i.e. defamation of character). A General Liability policy can cover the legal costs arising from the non-physical damages caused by your business’s actions.
Abusive Conduct coverage can protect you against losses related to lawsuits that arise from claims of abuse. The type of abuse can range anywhere from physical, verbal, emotional, or psychological.
- General Liability Insurance does not cover professional wrongful acts or errors. That is a Professional Liability Insurance (aka Errors & Omissions Insurance) and is a separate type of coverage.
- General Liability Insurance also do not cover you for costs associated with damage to your own property. That can be protected through a Property or Inland Marine Insurance policy (equipment coverage).
- General Liability Insurance does not cover any employee injuries. Employee injuries would be covered under a Workers’ Compensation policy.