Commercial general liability insurance (CGL) is typically the first type of business insurance that a company or establishment secures. This is because this type of insurance provides extensive protection against third-party liabilities. In an increasingly litigious society, having commercial general liability in place can be the difference between a business succeeding or failing.
Though there are other types of insurance coverages that are also important to a business, (such as commercial auto insurance, or worker’s compensation insurance), they are often added to a policy that already has commercial general liability coverage in place.
Why You Need Commercial General Liability Insurance
These days, it is not only fortune 500 businesses that get sued; in fact, around 52% of all civil lawsuits are directed against small businesses. Without having proper insurance in place, such instances can bring a business to a grinding halt – and some may not recover at all. Commercial general liability insurance protects your business from financial loss in the event that your operations, services, and/or employees cause any of the following:
- Accidental injuries: CGL will protect your business in the event that customers or suppliers visiting your place of business accidentally sustain an injury
- Product liability: CGL will protect your business if any injuries are caused as a result of a product you created or sold
- Property damage: CGL provides coverage in case an employee causes any property damage while delivering goods or services to a customer
- Reputational liability: CGL covers your business in the event that you are sued for personal or advertising damages relating to slander, libel, and so on.
In case you are new to business insurance, it’s completely understandable that some of these above terms may be vague. In this blog, we will give you some concrete commercial general liability examples of claims that will help to deepen your understanding.
Commercial general liability insurance is predominantly secured to help with medical costs and legal costs in the event that your business is found responsible for bodily injuries to third-party individuals (e.g. customers, the general public, suppliers, etc.) These injuries can happen within your premises or as a result of your operations.
- A restaurant’s employee mopped the floors and forgot to put up a caution sign to warn customers about the wet floors. The customer then slips and is injured.
- An overhanging lamp in a boutique falls on the head of a shopping customer, thereby causing injury.
- While a construction firm is building a house, one of the tools falls off the roof and ends up injuring a pedestrian below.
Commercial general liability insurance will provide coverage in the event that the products you’ve designed, manufactured, and/or sold are found to have caused injury or illness to any third-party individuals. This type of insurance will help with all legal and medical costs.
- A restaurant’s undercooked chicken causes food poisoning to its patrons.
- The manufactured and/or sold products of a skincare shop ends up causing damage to the customer’s skin.
- The sold/manufactured masks, gloves, and other PPE by a supplier are proven to be ineffective due to damage or faulty design and this causes injury/illness to the users.
If your business’s operations, services, or employees cause damage to third-party property, commercial general liability insurance will help with repair and replacement costs, as well as legal costs.
Here are five examples of types of insurance claims for commercial general liability:
- A plumber sent by a plumbing services provider makes a wrong move with a high-power tool, causing damage to the client’s home.
- A contractor from a waterproofing company is accused of worsening a crack on the home’s foundation.
- Workers from a snow removal company make a mistake with a snowplow, damaging a parked vehicle.
- While a renovation company does repair work on a home, a neighbouring property sustains damage due to their operations.
- Delivery personnel, installers, or handymen working within a client’s home accidentally knock over and break an antique item.
This type of liability includes personal and advertising injury. It protects the insured against liability arising out of offences such as libel or slander.
Here are five examples of reputational commercial general liability claims:
- Your business is sued by an individual or business for slander or libel.
- Another business sues your business for using their advertising idea.
- One of your advertising/marketing materials is sued for copyright infringement.
- Your business is sued by another business for product disparagement.
- Your business is sued for publications that violate privacy.
Additional Liability Coverages to Consider
Commercial general liability insurance provides extensive coverage when it comes to third-party liability claims. However, depending on the nature of your business, there may be other types of beneficial coverages to consider.
A few of common insurance coverages bundled with commercial general insurance include the following:
Commercial Auto Insurance
Commercial auto insurance provides coverage for businesses that maintain one or more commercial vehicles. This type of insurance provides protection when commercial vehicles get involved in incidents causing property damage or bodily injury. The physical vehicles are also insured in case they are stolen, damaged, or vandalized.
Worker’s Compensation Insurance
This type of insurance provides benefits to employees in the event that they get injured or sick whilst performing a work-related task or are within the premises. This type of insurance covers for lost wages, medical costs, as well as death benefits.
Pollution Liability Insurance
Pollution liability insurance covers legal costs, emergency response costs, and/or cleanup costs in the event that your business is sued for various kinds of environmental pollution. Such incidents of pollution can be sudden, gradual, or mould/legionella-related.
Customized Business Insurance That You Can Count On
For all savvy business owners and leaders who are looking to take advantage of commercial general liability insurance: not all general liability insurance policies are the same. Some insurance providers may have more exclusions than others. In order for you to get absolute, unrestrained transparency, as well as access to various insurance options, consult a trusted insurance broker like KASE Insurance.
We understand that each type of business comes with its own unique, industry-related risks. As an award-winning insurance brokerage company, we help businesses by creating custom-made insurance plans that will set them up for success. With our help, you can get commercial general liability insurance that addresses all the vital coverage points for your business – such as the ones discussed in this blog.
If you have any questions for us regarding commercial general liability insurance or any kind of business insurance, we’d be happy to connect. Contact us today or request a quick quote to get started!