Commercial liability insurance for businesses does not need to be complicated, but how does it work? Is there a solid approach to knowing how much commercial general liability coverage is enough for small businesses? Meslee Insurance offers insight into how insurance companies operate and how you can make the most of the commercial liability insurance landscape.
Small businesses face a unique set of challenges, and protecting your business is as important as managing your cash flow. The worldwide pandemic demonstrated that the insurance needs of your small business could change in an instant as new ideas, innovations, and lifestyle changes appear. Commercial liability insurance is a smart move, but what coverage does a general liability insurance policy offer?
A Word About General Liability Insurance
Injuries and property damage to a 3rd party can be inevitable as a business carries out its services and develops over time. However, without comprehensive commercial liability insurance, you will have to pay these claims out of pocket.
General liability insurance will usually cover common types of incidents such as:
- Bodily injury, including medical costs when a 3rd party (such as a customer) is injured at your place of business or because of your business activities.
- Property damage, if your business causes damage to a 3rd party and is found responsible while carrying out its business services.
- Personal & Advertising Injury, where insurance covers for risks such as false advertising, libel or slander.
General liability insurance usually does not cover the following:
- Company vehicle damage
- Medical costs from auto accidents for you or your employees
- Business interruption or loss of income from natural disaster
- Business interruption from employee absenteeism
- Professional liability issues (such as malpractice)
The likelihood of having a general liability insurance claim in the next ten years stands at about 40% for a small business. Commercial liability insurance is not a luxury—it is a necessity to protect your business.
Read on for ten things to know about liability insurance for small businesses, or reach out to our Meslee Insurance experts to take advantage of our general liability insurance options.
10 Trends & Things to Know About Insurance for Small Businesses
There are many insurance policies designed to cover certain aspects of risk. Small business owners must understand the types of policies and coverage. Here are ten considerations & trends in the insurance landscape:
#1 Flexible Workers Compensation Policies
The complexion of the small business workplace has changed rapidly as many employees opt to continue part-time work or full-time engagement from the safety of their homes. Recently, many states are adjusting to this by providing changes to class codes to reflect risk better. Does your worker’s compensation policy reflect this? Our business insurance agents can help answer these questions.
#2 Employment Practices Liability Insurance Aspects
New business platforms also necessitate Employment Practices Liability Insurance (EPLI). It has grown in popularity and become an essential coverage for small businesses. It supplements a workers’ compensation policy to cover non-injury-related damages, such as if an employee sues for unlawful termination or discrimination.
#3 Cyber Coverage
Past experiences were forgiving, but no business can afford to overlook Cyber insurance as cyber incidents increase. Protect your organization with comprehensive cyber coverage.
#4 The Data Dilemma
Knowing the ins and outs of a cyber policy and the coverage options is important. Some companies may have needs for 3rd party cyber liability, whereas others may need to focus more on cyber ransom and the ensuing loss of business income. Other companies that transfer money regularly prioritize coverage for social engineering. Meslee Insurance acknowledges the complexity of these insurance policies. We strive to understand your specific needs and find an ideal policy for you. We act as risk managers to identify, analyze and prioritize your business threats and opportunities.
#5 Ever-increasing Interruptions
Business income (interruption) coverage is critical, and it is important to have the proper plan to handle responses from your company’s services, operations, or products. The responsibility lies with you, but there are ways to ease the burden.
#6 Expanding Horizons
You might consider adding an umbrella policy to cover claims that exceed your general liability policy limits. How much commercial liability insurance coverage do you need? Consider these factors:
- Business Location: Some states award higher damage amounts, so carry enough coverage for the excess.
- Risk: Reflect the risk of operating your business in the current climate.
- Business type: An ammunition manufacturer may need higher limits of coverage than a doll maker, so speak to our agents about how to represent your business adequately.
- Business Size & Scope: A small coffee shop has different levels and location of risk compared to a food manufacturer.
Liability coverage varies between businesses, but consulting our full-service insurance brokerage will open doors. Let us assess your business needs and tailor a policy for you.
#7 Unfamiliar Landscapes
Remote employees mean that many small businesses now need new suppliers or product channels. If you have changed the way you do business, review the risk coverage with our agent to ensure you are still in a favorable position.
#8 Special Circumstances
Specialized coverage, like flood and earthquake insurance, is not part of your commercial property insurance. You will need to augment your cover with an endorsement or additional policy. The same applies to real estate construction policies.
Increased risk for real estate development businesses applies particularly to land developers, real estate contractors, building owners and specialized trades that build primary residences, buy, renovate, and sell commercial buildings. Livelihoods depend on a project, and professional liability is high when it takes months or years to finish, so general liability insurance is essential.
#9 No Room for Mistakes
Professional liability insurance is also known as Errors & Omissions coverage. It is vital for many different types of professionals, especially contractors at increased risk for allegations of inadequate advice, services, or designs from clients. Situations like this result in loss of income and time while defending your business against claims.
Professional liability insurance offers the security you need to do business with confidence. It covers errors made in professional services such as construction designs, including incorrect design claims, an unfit project for the purpose, and materials that differ from the specified plans. Many plans also include warranty claim coverage, safety and health coverage, pollution (asbestos) coverage, dishonesty and fraud of an employee, and lost documents.
#10 The Right Experience
Why do you need general liability insurance? A client or another business might require you to have this insurance coverage before transacting with you. They want to protect themselves from lawsuits, damages, and medical bills by relying on general liability coverage.
While the law does not require general liability insurance, it is prudent to protect your business from threats outside your control. Every small business has unique needs, and you should work with an agent who understands the details of your business and can help you navigate the niche effectively.
Meslee Insurance has years of experience in many different industries—ask us how we can help you find the right coverage for your small business today.
Enjoy Peace of Mind Alongside the Meslee Insurance Team
In today’s competitive and litigious business environment, the right coverage can protect your business and help you weather the storms. Our team works with you to discuss policy options and secure protection for your business against the unexpected. We excel in comprehensive accident prevention, claims management, loss control, and customer service.
Our full-service insurance brokerage offers three locations conveniently spread around the Los Angeles area. In this business, we value our relationships with top carriers that allow us to secure protection for you and your business with watertight commercial liability insurance options. Your business and your assets are safe with our coverage packages.
Meslee Insurance knows that you need a responsible and trusted insurance broker to recommend the right policy for your small business. Let us partner with you to find the insurance coverage you need and request a quote today.