Five Instances in Which General Liability Could Save Your Business

This post may contain affiliate links. Which means we may earn a commission if you decide to make a purchase through our links. Please read our disclosure for more info.

No one ever hopes they use it, but business insurance could save your business. The right insurance could protect your business from costly events such as lawsuits, product failures, business interruptions, and more. There is even special coverage that business owners can add that will be specific to their industry. Combining coverages into a comprehensive policy ensures that a business has good protection from a myriad of threats. However, the backbone of any good insurance policy begins with general liability. Broad liability coverage could protect your business from many of the most common issues. Don’t believe it?

General Liability insurance could protect businesses from incidents stemming from an injury, property damage, or libel. For example, suppose someone is injured on the premises of your business. In that case, general liability may help pay for damages and legal costs. Of course, not everything is covered under a general liability policy. Many businesses will require further coverage.

Furthermore, those shopping for a new policy will find that general liability cost may vary. For example, the cost of a general liability policy for your company can depend on where your business is located, how risky the industry is, the limits of the coverage, claims history, and the quality of your provider can all impact the final price.

Still, are you not sure about the utility of general liability insurance? Then the following five examples of when it could save your business are well worth your time.

Example #1 Slip and Fall

Almost every general liability policy will cover accidents that happen on company property. The most common worry (if you are a business owner who services the public directly) is that a customer will be injured on your business’s premises. The most typical example is a slip and fall. This is when a customer slips on a wet spot on the floor and takes a tumble, injuring themselves. Many cases can be due to general negligence on the part of the business—did someone forget to put up a caution sign? However, some lawsuits are brought by bad actors who fake accidents. This is a trend so ubiquitous that it has led to waves of pernicious lawsuits. Either way, damages can reach the millions if a company is held liable for an injury.

General liability coverage can help cover the associated legal costs regardless of which category your business’s accident falls into. Lawyers’ fees alone can cost thousands of dollars. In contrast, general liability insurance can typically be had for less than $250 a month. (With the price being highly dependent on your industry.) 

Example #2 Broken Property

Your business can’t function without essential equipment. And if that equipment is broken or damaged, you’ll need a repair or replacement stat. This is where general liability coverage can help save the day. Without it, you might be out the cost of a new desk, pizza oven, computer server, or foot spa, depending on your business. Damage to anything else that is essential for your work should be well documented, and a claim filed as soon as possible. This is so that your business can get back to normal as quickly as possible.

Some policies may handle theft under general liability coverage as well. However, this can vary by industry, as a retail business will often have additional coverage to protect against such losses. Still, not all theft insurance will cover all types of theft.

Example #3 Angry Clients

Let’s say that you have an angry client that says that you have defamed them. They may try to sue you for libel. General liability coverage in such instances can help protect the business and provide money for legal fees and potential damages. This policy most likely also covers the owner of the company, executives, and employees—as long as the events in question took place in a business-related capacity. (Personal conduct will not be covered.)

Example #4 Faulty Products, Services, or Operations

This example is more general than the others. But, if your business has made an honest mistake in producing any of its products, services, or operations, general liability coverage can help cover costs from the associated fallout.

Example #5 Damage to Property You Don’t Own

For our final example, let’s posit that you own a restaurant. Your front door is glass and shatters. You have to board up the window, and patrons have to walk through the eating area to pick up orders. You don’t own the building, and your landlord can’t be bothered to help. In such instances, general liability may be able to step in and fill the void by helping pay for the cost of the door. Of course, good documentation is a must, as is being sure to get a claim in on time. The insurance company’s ultimate goal may be to hold the landlord responsible for the cost of repair.

And there you have it, five examples of how general liability coverage could help save your business. While we all hope we never have to use it, knowing that there is protection from the worst should give business owners peace of mind. After all, even when they aren’t able to look out for their business, their general liability policy is.

Leave a Comment

Your email address will not be published.