General Liability Insurance

Normally, it is difficult for businesses or general contractors to work without general insurance. General liability insurance is intended to guard operators and owners of companies against claims that may come from a broad spectrum of sources. These exposures could be just about anything, including liability engendered by accidents from the operations of the insured party, contractual liability, products manufactured by the insured party, etc.

The liability you select, whether it is one, two, or three million dollars, determines the cost of general liability insurance. Also factored into the rates are the kind of work undertaken, gross receipts and total payroll expenses. Similar to auto insurance, when it comes to general liability insurance, you will first have to make a down payment and then follow it up with installments. Before buying general liability insurance, it is best to compare the quotes available in the market.

It is the business owner's or general contractor's job to make sure that the people working under him/her are covered by an insurance policy. If for example, a person who is not a part of the project gets injured, the injured person's lawyer can target just about anyone involved in the project. The more individuals that are involved, the greater the chances of a successful lawsuit.

What Does General Liability Insurance Cover?

General liability covers a lot of common issues that you might run into, particularly if you work on client properties or interact with customers on a day-to-day basis. Basically, this essential insurance policy covers bodily damage, property damage, and even reputation damage that were caused by your business.

Why do I need General Liability Insurance?

As a small business owner, you may be legally responsible if another person gets hurt or if their property is damaged while at your business or because of something you did. Make sure your business is properly protected against risks.

Here are a few scenarios to help give you a better idea of what General Liability Insurance covers:

Bodily Damage
You’re a general contractor who has been called to a client’s house to perform roof repairs. You’re up on the second story roof, working away when suddenly a pile of shingles slips off the roof and falls on your client, who unfortunately happened to be passing by. The client’s okay, but he had to go to the hospital to get checked out. As a result, you’ve ended up with a pretty large medical bill that you’re responsible for.
That’s where general liability insurance steps in. Depending on your policy limit, this coverage can cover the cost of your customer’s medical bills. It can even cover the cost of a lawsuit if your client decides to sue you for pain and suffering.

Property Damage
You run a successful cleaning business, so you have a whole team of employees who go out to clean homes and offices. One of your employees accidentally uses the wrong kind of cleaner on a client’s oak table, causing significant damage. The client calls you and demands that you replace the table or reimburse her for the original purchase.
Without insurance, you’d be 100% responsible for that bill – and even if you refused to pay it, your client could take you to court. However, your general liability coverage may be able to pay out the costs to your client, even if she decides to sue your business for property damage.