In Ohio, Business Liability Insurance forms the foundation of protection for most businesses and their insurance portfolio. This policy, often referred to as Commercial General Liability Insurance, or just General Liability (GL for short) protects businesses from most liability exposures, with the exception of auto and professional services.
Nearly every business faces the risk of being sued for injuries it causes, which is why your business should start with a general liability policy.
The best way to effectively protect the assets of your business is to carry adequate Business Liability Insurance coverage. Business Liability Insurance protects your business from damages caused by bodily injury or property damage for which your business is found to be legally liable.
Perhaps your business also needs an auto policy and even several other liability insurance policies.
Tip. Make sure you use an experienced commercial insurance agent when reviewing your different liability exposures. Without the proper protection, you’re risking your business and possibly your personal assets.
Business Liability Insurance is written in two distinctly different forms. Depending on your type of business, you might only have one option so it’s important to understand the difference between the two.
Two are available:
- An Occurrence policy. (the most common) A claim is paid if it happens during the policy period.
- A Claims Made policy. A claim is paid if made during the policy year, and the claim had to occur on or after the retroactive date.
This can create problems when you switch between the two types of forms.
What Does Business Liability Insurance Cover?
A typical Business Liability Insurance policy provides coverage for claims of bodily injury or other physical injuries, personal injury (libel or slander), advertising injury and property damage as a result of your products, premises or operations.
As a safeguard against liability, Business Liability Insurance enables you to continue your normal operations while dealing with real or fraudulent claims of negligence or wrongdoing. Business Liability policies also provide coverage for the cost to defend and settle claims.
Here’s more detail into what a typical policy may cover:
- Automatic additional insured: Coverage is provided for written contracts, agreements and permits.
- Personal and advertising injury: Protects against offenses made by you or your staff during the course of business, such as libel, slander, disparagement or copyright infringement in advertisements.
- Defense costs: Provides coverage for legal expenses for liability claims brought against your business, regardless of who is at fault.
- Medical expenses: Provides coverage for medical expenses if someone is injured on your premises or by your products.
- Premises and operations liability: Provides coverage for bodily injury and property damage sustained by others on your premises or in conjunction with your business operations.
- Products liability: Provides coverage for bodily injury and property damage sustained by others as a result of your products.
How Much Coverage Does Your Business Need?
The amount of coverage that your business needs depends on three factors:
- perceived risk
- where you operate your business, and
- the type of products you manufacture.
Perceived risk: Consider the amount of risk associated with your business operations and functions. For instance, if you manufacture heavy machinery, you would generally need more coverage as compared to another organization that manufactures stuffed animals.
Premises and operations liability: If you operate in a state that has a reputation for rewarding high damages, then you may wish to purchase higher limits of liability.
Type of product manufactured: If you manufacture a dangerous product, you may want to carry higher limits of liability.
Remember, you can purchase an Umbrella Liability policy to help achieve the desired limit of liability if you feel the coverage provided does not adequately protect your business.
And as an added bonus, Umbrella policies often provide additional liability protection over the other policies your business needs such as Commercial Auto, Employee Benefits Liability and Employers Liability coverage.
Other Ways to Protect Your Business, In Addition to Business Liability Insurance
Here are some other tips for protecting your business:
- Establish a high standard for product quality control at your organization
- Keep all company records up to date and accurate
- Train your employees thoroughly and properly
- Ask us for safety and compliance information
We understand that your business needs to be protected, and we’re here to help. Please contact us today to learn more about our risk management and insurance solutions, or if you’re ready to get started, you can Request a Proposal.