Commercial General Liability

Introduction to Commercial General Liability Insurance

Commercial general liability insurance is designed to protect businesses from financial losses and legal disputes related to third-party claims of bodily injury, property damage, or personal and advertising injury. In other words, if someone is injured on your property, or if your business is responsible for damaging someone else’s property or reputation, your commercial general liability coverage can help cover the costs of legal defense and any settlements or judgments that may be awarded.

What is Covered by Commercial General Liability Insurance?

Understanding what does liability insurance cover is crucial for business owners. Commercial general liability insurance typically covers three main types of claims: bodily injury, property damage, and personal and advertising injury. We will discuss each of these types of claims in more detail below.

Bodily Injury

If someone is injured on your business’s property or as a result of your business’s activities, your commercial general liability insurance can help cover the costs associated with the injury. This may include medical expenses, lost wages, and pain and suffering. Additionally, if the injured party decides to file a lawsuit against your business, your general liability insurance coverage can help cover the costs of your legal defense, as well as any settlements or judgments that may be awarded.

Property Damage

If your business is responsible for damaging someone else’s property, your commercial general liability insurance can help cover the costs of repairing or replacing the damaged property. This may include damage to a customer’s car in your parking lot, or damage to a neighboring building caused by a fire that started on your premises. Your general liability insurance coverage can also help cover the costs of your legal defense if the property owner decides to file a lawsuit against your business.

Personal and Advertising Injury

Personal and advertising injury refers to claims of libel, slander, invasion of privacy, copyright infringement, or false advertising. If your business is accused of causing harm to another person or company’s reputation or intellectual property, your commercial general liability insurance can help cover the costs of your legal defense, as well as any settlements or judgments that may be awarded.

Types of Claims Covered by Commercial General Liability Insurance

In addition to the three main types of claims discussed above, commercial general liability insurance can also provide coverage for a variety of other claims, depending on your policy. Some examples of additional claims that may be covered include:

Product liability: If your business manufactures, distributes, or sells products, you may be held liable for any injuries or damages caused by those products. Your commercial general liability insurance can help cover the costs of defending against product liability claims and any settlements or judgments that may be awarded.
Completed operations: If your business provides services, such as construction or repairs, you may be held liable for any injuries or damages that occur after the work is completed. Your commercial general liability insurance can help cover the costs of defending against completed operations claims and any settlements or judgments that may be awarded.
Contractual liability: If your business enters into contracts that require you to assume liability for certain risks, your commercial general liability insurance can help cover the costs of defending against contractual liability claims and any settlements or judgments that may be awarded.

What is Not Covered by Commercial General Liability Insurance

While commercial general liability insurance provides critical protection for your business, it is important to understand that there are some types of claims that are not typically covered by a general liability policy. These may include:

Employee injuries: Workers’ compensation insurance, rather than commercial general liability insurance, is designed to cover the costs of employee injuries and illnesses that occur on the job.
Damage to your own property: Commercial general liability insurance does not cover damage to your own business property. This type of coverage is typically provided by commercial property insurance.
Professional errors or negligence: If your business provides professional services, such as consulting or financial advice, you may be held liable for any errors or negligence that result in financial losses for your clients. Professional liability insurance, also known as errors and omissions (E&O) insurance, is designed to cover these types of claims.

Types of Claims Not Covered by Commercial General Liability Insurance

In addition to the exclusions discussed above, there are some other types of claims that are typically not covered by commercial general liability insurance. These may include:

Pollution and environmental damage: If your business is responsible for causing pollution or environmental damage, your commercial general liability insurance may not cover the costs of defending against or settling these claims. Instead, you may need to purchase a separate environmental or pollution liability policy.
Cyber liability: Cyber liability claims, such as data breaches or cyberattacks, are generally not covered by commercial general liability insurance. You may need to purchase a separate cyber liability policy to protect your business from these types of risks.
Employment practices liability: Commercial general liability insurance typically does not cover claims related to employment practices, such as discrimination, harassment, or wrongful termination. You may need to purchase a separate employment practices liability insurance (EPLI) policy to protect your business from these types of claims.

Frequently Asked Questions About Commercial General Liability Insurance

As a business owner, you may have additional questions about commercial general liability coverage and what does general liability cover. Here are some frequently asked questions and their answers:

How much commercial general liability insurance do I need?

The amount of commercial general liability insurance you need will depend on a variety of factors, including the size and nature of your business, the level of risk associated with your industry, and any legal or contractual requirements you may have. It is important to work with an experienced insurance agency, like Integrated Insurance Advisors, who can help you determine the appropriate level of coverage for your business.

How much does commercial general liability insurance cost?

The cost of commercial general liability insurance will vary depending on several factors, including your business’s size, location, industry, and claims history. In general, businesses that have a higher risk of liability claims, such as construction companies or manufacturers, can expect to pay more for their insurance coverage.

Can I bundle my commercial general liability insurance with other types of business insurance?

Yes, many insurance providers offer bundled insurance packages, also known as business owners’ policies (BOPs), which can include commercial general liability insurance, commercial property insurance, and other types of coverage tailored to the needs of your specific business. Bundling your insurance policies can often result in cost savings and make it easier to manage your insurance coverage.

Other Types of Liability Insurance to Consider

In addition to commercial general liability insurance, there are several other types of liability insurance that you may want to consider for your business. These include:

Professional liability insurance (errors and omissions insurance): This type of coverage is designed to protect businesses that provide professional services or advice, and can help cover the costs of defending against claims of negligence, errors, or omissions.
Directors and officers (D&O) liability insurance: This type of coverage is designed to protect the directors and officers of a company from personal liability for actions taken on behalf of the business. D&O insurance can help cover the costs of defending against claims of mismanagement or breach of fiduciary duty.
Employment practices liability insurance (EPLI): This type of coverage is designed to protect businesses from claims related to employment practices, such as discrimination, harassment, or wrongful termination.
Cyber liability insurance: This type of coverage is designed to protect businesses from the financial and reputational risks associated with data breaches, cyberattacks, and other types of cyber incidents.

Commercial general liability insurance is an essential component of any business’s risk management plan, providing protection against a wide range of potential claims and legal disputes. By working with Integrated Insurance Advisors, you can ensure that your business has the appropriate level of liability coverage to safeguard your company’s assets and financial stability.

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