Building a business takes an incredible amount of determination, resilience and resources. Without the proper protection, however, opening your doors could bring a variety of dangers from medical bills for hurt victims to lawsuits, which can cost millions of dollars.
These dangers are why businesses invest in insurance such as general liability insurance.
With general liability insurance, the insurance company will help pay for legal fees and other expenses related to an accident at your business.
One example is if a visitor—say a shareholder—visits your warehouse and is injured. In some cases, general liability can help pay for their medical expenses as well as protect your business against a lawsuit. There are some cases where you may need professional liability, however.
What Does General Liability Insurance Cover?
A general liability insurance policy typically covers:
Bodily Injury: If someone is injured on your property, general liability insurance can cover the victim’s medical bills.
Property Damage: Property damage cover expenses if a third party’s property is damaged due to the business’ everyday operations.
Personal and Advertising Injury: Personal and advertising injury covers claims against the business concerning libel, slander, fraud, copyright infringement and more.
What is the Difference Between General Liability and Professional Liability?
While both insurances deal with legal fees that come with claims, both are vastly different. General liability handles accidents due to non-professional negligence. In other words, injury or damage as a result of daily business practices. Professional liability deals directly with accidents involving negligence on behalf of a business. For example, say you’re a home inspector and you fail to notice a leaky pipe. The homeowner moves in, discovers the leaky pipe and sues you because they now must pay to fix the leaky pipe. This is a case where professional liability steps in.
How Much Does General Liability Insurance Cost?
In the US, the average cost for general liability insurance is around $741 a year, or $62 a month. This rate changes depending on the size of the company, amount of coverage, the industry and your location. Industries that are considered at higher risk, such as wholesalers and retailers, tend to pay more since they’re more likely to file a claim. Small businesses can pay as low as $17 a month for general liability insurance.
Shop around, compare quotes and ask an insurance agent about any questions you may have regarding your general liability insurance.