General liability insurance

General liability insurance is the most basic and recommended type of coverage. It is designed to protect an individual’s or company’s assets from being diminished by lawsuits and insurance claims. A single lawsuit may cost tens of thousands of dollars to handle and reduce the credibility of your business, as well.

As a business owner, you can get sued by anyone who claims negligence at your hands. Someone can have an accident on your property and blame you for it, even if he or she acted irresponsibly. The insurer helps to determine who is right or wrong and pay out a claim correctly.

Who Needs This Coverage?

General liability insurance is offered to individuals and professionals who serve the public. Homeowners need to be covered for liability if someone is injured on their property. Business owners need protection from being sued, whether they have 10 or 1,000 customers. In some states, this type of insurance is required for a business to operate and for a professional to be licensed.

How Do You Get Covered?

You get covered for liability insurance by paying a monthly premium to your provider. When you file a claim, you usually do not receive any payments, which are given to the individual who suffered damages. Your insurer may protect your legal rights, even if you caused the accident, so all legal defense costs are covered throughout the trial.

Which Type of Coverage Do You Need?

General liability insurance policies mainly cover property damages, made to a home or vehicle, and physical injuries. The specific types of coverage and the monetary limits are different for each insurance provider.

The types of liability insurance are defined in three main areas: public liability, product liability and employer insurance. Public liability covers damages that involve customers, visitors, vendors and all members of the public. Product liability is used by manufacturers who are liable for the safety and efficiency of their products. Employers may be required to have insurance in case their employees sue them. In the U.S., this type of coverage is called workers’ compensation insurance.