Insurance

The Importance of Commercial General Liability Insurance

Do you own a small or medium-sized business? Are you looking to protect your assets? Have you considered purchasing commercial general liability insurance? If you haven’t, you must do so, fast.

Commercial General Liability (CGL) Insurance is a must-have for any business that operates in a public space or serves the public in any capacity. Without it, your business could be held accountable for its negligence.

Read on to learn more about this type of insurance and why it’s so important.

What Is Commercial General Liability Insurance?

Commercial general liability insurance is one of the most important types of business insurance. It protects businesses from third-party claims that occur on the business premises or because of business operations.

It is an essential part of any business risk management plan. It is written on an occurrence basis, which means it covers claims during the policy period, regardless of when the claim’s filing date is.

In today’s litigious environment, having this general liability coverage is essential for any business that wants to protect its assets and financial well-being.

The Cost of Commercial General Liability Insurance

The cost of general liability insurance varies depending on the size and type of business, but it is typically a few hundred dollars per year. The insurance cost may be higher for businesses at higher risk for liability claims.

You may consider it expensive, but the cost of commercial general liability insurance is a small percentage of the cost of running a business. It is also much less than the cost of defending a lawsuit.

While no one likes to think about the possibility of being sued, it is important to have this type of insurance in place in case the worst happens.

The Consequences of Not Having Commercial General Liability Insurance

CGL can help cover the costs of legal defense and out-of-pocket damages that may be awarded in a liability lawsuit, up to the policy limits.

Without this business coverage, your business would be vulnerable to lawsuits. It could also be held liable for these costs, such as legal fees and settlements. This could bankrupt your company, or worst it could make it out of operation.

Even if you are not found liable, the legal costs associated with defending yourself in court can be devastating to your business.

This type of insurance is especially important for small businesses, which may not have the resources to defend themselves against a lawsuit.

The Insurance Coverage

A CGL policy is insurance that business owners and operators buy to protect themselves from various liabilities. The potential liabilities covered by a CGL policy can come from many sources, including:

Property Damage

Commercial general liability insurance is critical for any business. But it is vital for companies that deal with property damage. This can help cover the repair cost if your business damages someone else’s property.

Even if you are careful and have never had an issue with property damage before, it only takes one accident to ruin your business.

Bodily Injury

In the event that someone gets injured on your property or as a result of your operations, this insurance will cover medical expenses. They will also cover lost wages, pain and suffering, and any legal fees that may arise.

Events can include slips and falls, physical assault, and even emotional trauma.

Advertisement Injury

CGL can help cover legal expenses if someone files a suit alleging that your advertisement caused them personal injury or financial loss.

Advertisement Injury can occur in many ways, including online. These are if customers are defamed or slandered on the website or if the website itself is defamatory.

While some businesses may feel that they can self-insure against these risks, it is always best to have a solid insurance policy in place.

Reputational Harm

One of the more intangible, but devastating risks businesses face is that of reputational harm. A company’s reputation is its most valuable asset.

General liability insurance can help businesses bounce back from an incident. They cover the costs of things like crisis management and public relations.

CGL can help them maintain their good reputation. It can also protect them against the effect of a lawsuit alleging reputational harm.

Copyright Infringement

This is when someone uses your copyrighted material without your permission. CGL can help protect you financially if you are sued for copyright infringement.

This type of insurance is vital, as even a small copyright infringement claim can be expensive to defend.

What’s Not Included?

Indeed, this insurance gives you peace of mind knowing that your business is protected against damage claims. But, it is essential to note that CGL policies do not cover everything, and business owners should be aware of what is excluded from coverage.

Common exclusions from CGL policies include employees’ injuries or illnesses, and theft or damage of your business property. It also excludes professional liability, automobile liability, product liability, and illegal acts.

It is important for business owners to understand these exclusions and buy the appropriate business insurance for their needs.

Safeguard Your Business With CGL

As a business owner, the thought of being sued for something that happens in your business is always a worry. You are responsible for the well-being of your employees, customers, and the public. That is why you need to safeguard your business with commercial general liability insurance.

Without it, you could be facing a large financial burden, which could jeopardize the future of your business. A strong CGL policy can help prevent a small problem from turning into a major disaster.

Talk to your insurance agent to find out if this type of insurance is right for your business.

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