CGL Insurance - Commercial General Liability

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Much like you have insurance for your vehicles and your home, it’s important to insure your business as well. All businesses should have liability coverage including home-based businesses, many of which aren’t insured at all. Your homeowner’s insurance policy may have liability coverage but a standard homeowner’s policy doesn’t cover business-related claims.

Businesses of all sizes benefit from Commercial General Liability Insurance (CGL Insurance) which protects your business against a number of common risks that can threaten the business you’ve worked so hard to build.

What risks are covered by CGL Insurance?

You can think of your Commercial General Liability Insurance as a policy to protect your business against a broad set of claims made against it for causing bodily injury, property damage, or other more intangible forms of damage.

Your CGL Insurance policy can help protect your business against claims for:

  1. Property damage — In business, property belonging to other businesses, individuals, or customers can be accidentally damaged. Your CGL policy can provide protection so that mishaps don’t interrupt cash flow or deplete your operating capital.
  2. Physical injury — Even the most careful of businesses still have a risk of bodily injury to clients, visitors, or other people. Ladders or boxes can fall. Ice or spills can lead to injuries. Commercial General Liability Insurance can cover these risks that exist in every type of business.
  3. Personal and advertising injury — Personal injury differs from physical injury because it relates to slander or libel, actions that can damage the reputation of others, invades the privacy of others, or infringes on others, including unintentional copyright infringement. Similarly, advertising injury relates to liability if your business’ advertising causes a loss to others, such as using someone else’s advertising idea in your ads. A CGL policy provides protection against this broad group of common risks.
  4. Defense costs — Even in cases where your business is found not to be liable for damage to others, the cost of legal defense and court expenses can result in thousands or tens of thousands in unexpected court fees and attorney expenses. Your CGL insurance policy can cover these costs and, in most cases, the cost of your defense is outside of your coverage limit. This means that the cost of your defense usually won’t reduce the amount of liability coverage available for your business if you have a claim.

What’s not covered by CGL Insurance?

A Commercial General Liability Policy is the foundation of a well-structured insurance strategy. However, many businesses may need additional coverages that are provided by other types of policies. The insurance needs of each business are unique but some types of coverage are also common components in a protection strategy for many businesses.

Commercial Auto Insurance — Your CGL policy covers many types of liability but auto liability is excluded from coverage because the risks differ and each state has unique coverage requirements for auto liability insurance. A Business Auto Policy can provide protection for your commercial vehicles from sedans to semis.

Workers Compensation — Nearly all states require Workers Compensation coverage for businesses with employees. Requirements vary by state but this important coverage provides protection for both your employees and your business. With Workers Comp, your workers gain benefits such as paid medical expenses for work-related injuries, and your business benefits by avoiding fines, retaining employees through offering coverage, and can often avoid lawsuits related to employee injuries.

Business Property coverage — A Business Owners Policy or a Commercial Package policy can add coverage for your business property, including real estate, fixtures, supplies, inventory, equipment, and more — as well as the coverages provided by your CGL policy.

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What types of businesses need CGL Insurance?

With many common risks covered by CGL insurance, including slip and fall accidents and unintentional personal injury, it’s difficult to imagine a business that doesn’t need Commercial General Liability Insurance. Liability risks are a threat to businesses of all sizes and the potential for large losses isn’t limited to large companies. A bodily injury lawsuit can easily result in a claim amount that’s higher than annual revenue for a small or mid-sized business.

Home-based businesses are at particular risk, not because the risks are higher, but because so many home-based businesses are uninsured. A standard home insurance policy doesn’t provide protection for business-related liability and many or the protections provided by a CGL policy, including personal injury and advertising injury, don’t exist in a home insurance policy at all.

Small and medium-sized businesses often aren’t as well-capitalized as larger companies, which puts these businesses at higher risk because they may not have sufficient capital to pay for a liability loss with business savings, sales of assets, or from cash flow. A CGL insurance policy provides the protection you need to keep your business growing.

Additionally, it’s common for CGL insurance to be a requirement for commercial leases, financing, or for work contracts where the company you are contracting for may ask to be an additional insured. A standard policy starts with coverage limits of $1 million per occurrence, with a $2 million aggregate limit. Coverage limits can be raised to match the needs of your growing business.

Business Insurance

Running a business is challenging enough without having to worry about lawsuits, employee injuries or property damage. Having the right insurance gives you the peace of mind to focus on what matters - running your business.

The coverage you need depends on the type of business you run. A restaurant owner needs to be covered against customers possibly getting food poisoning while an accountant needs to be covered against calculation errors. CoverWallet's intelligent assessment system will identify the insurance you need based on your specific business, get you a policy that fits your budget, and do it all in less time than you think.

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