Business owners rely upon insurance for protection in the event of an accident or loss. One of the most common insurance policies is Commercial Liability.
But how would you determine its protection for properties, coverage needs, and working procedure? Read on to know how the commercial liability works.
What is a Commercial Liability?
This is a type of liability insurance (also known as Commercial General Business Liability) provides coverage for personal injuries, property damages, bodily injuries caused to you or your employees, by any materials or operations within the business premises. This coverage is considered as comprehensive business liability.
Why Do You Need Commercial Liability for Business?
You are mistaken to think that you may not face any future claim in this litigious society. If you do not insure your business, you may put its position at stake and suffer severe losses. Commercial Liability is a comprehensive liability providing you with wide-ranging coverage for the protection of your business.
Other than covering injury costs for you and your employees, it covers the cost of your legal defense and settlement. They include punitive damages, non-monetary losses, and compensatory damages, suffered by the injured party. Additionally, it covers losses for any rental property. Not only this, it provides coverage for claims against copyright infringement, misleading advertisement, or slander.
How Will You Determine Your Coverage Needs?
Coverage of Commercial Liability depends upon the nature of your business, business' location, and perceived risk of the business. If you are a building contractor, your business may require more coverage than a consultant or a web designer. This is because of the distinct business natures and perceived risks.
As for the business' location, some states permit more coverage for personal injuries than other states. Therefore, if you are operating a business in a different state, you will be granted with more coverage by the insurance company. You should consult an experienced insurance broker before insuring liability for your business.
How Commercial Liability Insurance Works?
Being an insured, requires filing a claim if an incident occurs. It is your responsibility to inform your insurance company or the agent immediately. You should be prepared to properly explain the unfortunate incident in detail. For this reason, you must know the correct date, time, names of the witnesses (if any), and any other important information related to the incident.
Your insurance company sets a maximum value or amount for your commercial liability. The maximum value for coverage is set by mutual coordination depending upon certain factors. If your business gets sued for $400,000 medical costs associated with an injury within your business' premises and your coverage maxes out at $450,000. Then, you need not worry; the insurance company will pay for the claims.
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