For a modern company, just operating a business poses many risks. What may have been shrugged off as a small incident in years past, can now result in lawsuit with enormous damages. This is why more and more business people are turning to general liability insurance to help manage the risks of simply going about your business. General Liability insurance, often called business insurance is the most commonly used insurance tool to shield the assets of a business for something it did or failed to do to prevent an injury or damage to property.
General liability insurance can be purchased by itself or bundled together into a business-owners policy, also known as a BOP. There are very few business that should pursuit a business-owners policy for several reasons. First, while a BOP is easier from a paperwork perspective, in that you only need apply for one policy, BOPs are usually more expensive.
"A BOP does not include professional liability insurance, which protects you from losses or expenses resulting from claims of errors or omissions or negligence in your business" -Entrepreneur.com
Second, business owner policies usually provide a cookie-cutter approach to coverage you need, looking less at your total risk portfolio and more at simply the size of your business. A good way to look at this is through the metaphor of your homeowners and auto insurance. While it would be easier to apply for your home owners and auto insurance on one policy, it could leave you exposed if you bought into a policy that looked only at your household income to establish coverage level versus looking at the cost to replace your car and home should a claim arise. Similarly unbundling a business owner policy has similar advantages.
So How Much General Liability Insurance Coverage Do you Need?
Like most businesses there are generalists and specialists. Often commercial insurers work exclusively on general liability insurance, worker's compensation insurance, and business property insurance. They have access to the risk profiles and coverage amounts of similar businesses to your and can help you establish a baseline minimum for coverage. Also a professional commercial insurance specialist can help you understand where the three forms for insurance dovetail so that you don't over-purchase one particular kind of insurance.
The State or States Your Business Operates in Can Have an Effect On Your General Liability Insurance Needs
Some states tend to lean heavily in a plaintiff's favor, and require businesses to carry higher-limits on certain aspects of their risk. In this case a special liability rider can be added to your base policy to cover that state-mandated risk. Also if you do business in more than one state or you visit clients or vendors in other states it is good to work with a professional commercial insurance broker, like Generalliabilityinsurance.org, that can provide guidance and access to the proper insurance resources for your needs in every state.
Is your Business Already Locked Into a Long-Term Commercial Insurance Policy?
Let us take a look at your policy and help you understand if your policy limits make sense for your risk exposure. Your existing policy may fits your needs and require little or no new insurance. Often times a rider or the purchase of an inexpensive umbrella policy is enough to get your business where it needs to be to manage its risk.
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