General Liability Insurance Definition
A general liability insurance definition clarifies the differences between this form of coverage and other types of liability insurance. When you're looking for coverage to protect your company against losses due to litigation, you'll find that there are a number of plans that insure commercial entities. Each of these plans meets the needs of different types of businesses. Use the resources on this website to learn about the definition of different forms of protection for businesses.
The general liability insurance definition refers to a plan that insures your business against lawsuits due to bodily injury, personal injury, property loss or advertising injury. If a complaint goes to court, your insurance benefits would pay for your legal fees and for damages awarded to the plaintiff. General liability insurance secures your business's financial assets when you are involved in litigation due to an accident or mishap.
Covered General Liability Risks
The general liability insurance definition encompasses bodily injuries. If one of your clients, guests, vendors or even a trespasser is injured on your premises, you may be held legally responsible for their medical expenses. Some businesses choose to extend their general liabilities protection with a no-fault medical payments plan, which pays for minor medical care in order to avoid litigation.
Property losses are included in the general liability insurance definition. If a fire breaks out at your workplace and a neighboring building is destroyed, you may be held liable. Property damage may be significant if an occurrence has widespread effects. By definition, your plan should pay benefits to defend you against lawsuits resulting from these occurrences.
If a customer or member of the public feels that you breached their privacy or harmed their reputation through false advertising, you could be sued for personal or advertising injuries, according to the general liability insurance definition. Personal and advertising injuries are not always easy to define. In order to be awarded damages, a plaintiff must prove that the injuries occurred as a result of something your business did. However, you may still pay considerable legal fees defending your company.
Businesses that Need General Coverage
According to the general liability insurance definition, any commercial organization that offers a product or service to the public can benefit from this form of insurance. A large or small business involved in retail, hospitality, manufacturing, production and assembly or other industries can reinforce its risk management strategy with adequate coverage against liabilities.
In today's litigious environment, lawsuits can have a devastating effect on your company's financial future, especially if you live in a state where the preponderance of commercial cases are decided in the plaintiff's favor. Although you can't change this aspect of the court system, you can reduce your exposure to liabilities by making your work place as safe and secure as possible.
Errors and omissions committed by a highly trained professional in private practice are not included in the general liability insurance definition. These occurrences, which may fall under the definition of negligence, are covered by professional liability insurance policies. In general, counselors, therapists, medical consultants, architects and other professionals who offer solutions or advice require professional liability insurance.
Purchasing General Liability Protection
A company has the option to purchase property and liabilities protection in a single package, called a business owners policy, or BOP. However, the general liability insurance definition is limited to policies that focus exclusively on protecting your business against the financial effects of litigation. By definition, this type of coverage is more extensive and has more versatile applications for your organization.
The internet makes it easy for you to compare quotes from different providers and investigate the definition of each plan they have available for businesses like yours. If the definition of a covered risk or benefit mentioned in your contract isn't clear, ask your broker or a company representative to clarify it for you. When you're investing in this important form of protection, it's crucial to understand the terms of your agreement so that you can get the most value from your plan.
Over time, if your business doesn't file very many claims, you may be eligible for a reduction in the cost of your plan. Reducing claims can often be accomplished by implementing simple precautions like keeping stairways free from clutter, repairing broken fixtures immediately and keeping your floors free from spills. Talk with your insurer about easy-to-implement risk management strategies that can save your company thousands of dollars in litigation costs.
Once you understand how the general liability insurance definition differs from other policies, you'll know whether this type of contract meets your company's requirements. A broker or agent can work with you to find protection that suits the size and nature of your organization. Take advantage of the tools on this website to secure the best form of coverage for your company.