How to Know if You Need General Liability Insurance

Every business is different, meaning your insurance needs may not be the same as another business’ even in the same industry. Knowing what type of business insurance you need is just as important as knowing when you need to purchase it.

General liability insurance is one of the most common and useful types of commercial insurance policies. This insurance covers three main areas:

Bodily Injury: Bodily injury under general liability insurance covers injuries third parties may face on your business’ property. For example, if a visitor slips and falls in your store, general liability insurance can help cover their medical bills. It can also provide your business with compensation for a related lawsuit.

Property Damage: Property damage under general liability insurance covers property damage someone else may face as a result of the business’ everyday operations.
Personal and Advertising Injury: Personal and advertising injury covers claims against your business regarding libel, slander, malicious persecution, copyright infringement, theft of an advertising idea and more.

Essentially every business faces these sort of dangers day in and day out. If you have a physical location, there is always a chance that someone will be injured on your business property. Even if you work from home or only have an online store, you could face personal and advertising injury.

There are also additional liability options depending on your business such as:

Professional Liability

Umbrella Liability
Directors and Officers

Some of these liability policies may be needed in different situations. For example, if you or your employees offer a professional or specialized service, you may need professional liability insurance.

Is General Liability Insurance Required?

As a rule, general liability insurance isn’t required by any state or federal law. In some cases, however, you may need general liability insurance in order to operate within certain industries or to obtain professional licenses.

This is especially true if you have a physical location, as a lender may require you to carry both general liability insurance and commercial property insurance. Business owners can often combine these two coverages into a single policy called a business owners policy (BOP).

If you are not sure about what type of insurance you need, be sure to speak with an insurance agent. They can help evaluate the risks your business faces day to day so that you can tailor a policy for your needs.

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