4 Types of Liability Insurance Every Business Should Have: It’s important for companies to do things the right way and be safe. But sometimes things can still go wrong because people make mistakes. If that happens, the company might have to pay for the damage. To make sure they’re protected, companies need to have insurance.
Nearly every business out there needs these four types of liability coverage to be adequately protected:
- Commercial General Liability
- Professional Liability
- Cyber Liability
- Employment Practices Liability
Commercial General Liability
All businesses need to have insurance to protect them if someone gets hurt because of something they did wrong. This is called Commercial General Liability. It helps keep their things safe if someone sues them. This means that if something bad happens to someone because of something you did or made, like if they get hurt or something gets broken, you might have to take responsibility for it.
Also, if you say things that aren’t true or make people believe something that isn’t real, that could also cause problems. If something bad happens and someone sues your business, General Liability insurance can help pay for it. It can cover up to $1 million for one problem and up to $2 million overall. The aggregate means adding up all the different things that could go wrong, like someone getting hurt in your store, saying bad things about another business, or accidentally breaking something while building.
Most businesses have a limit of one million dollars for protection, but if they need more, they can get something called an Umbrella policy which gives them more coverage for a reasonable price. If you don’t have something called General Liability coverage, and someone gets hurt or is unhappy with something your business did, you could have to pay a lot of money to fix it or defend yourself in court. This could be so much money that your business might have to close down.
A Note About Products Liability
Some jobs are more dangerous than others, so the people who do those jobs need special insurance to protect them. This insurance is different from the regular insurance that most people have. If someone makes something that people can eat or that might be dangerous, they might need a special insurance policy to protect them. This insurance can help if someone gets hurt because of what they made or if they need to recall their product.
Some jobs require a special kind of insurance called Professional Liability coverage. This is for people like doctors, lawyers, and other professionals who give advice that their clients use to make important choices. It’s important to have this insurance to protect yourself and your clients. This helps protect people who give their expert opinions for a living.
But now, it’s becoming more common for people who do other jobs to have this protection too. Like people who build things, advertise products, and give advice. Say a person called a contractor to make a driveway, but after a week it started to break. The reason was because the contractor didn’t mix the concrete correctly.
The contractor would have to fix it themselves because it was their mistake. This mistake wouldn’t be covered by their insurance, but they could still pay to fix it with another type of insurance they have. If the business doesn’t have this protection, they have to pay for any problems that happen all by themselves.
Bad people who use computers to steal and do bad things are expected to cause almost a TRILLION dollars in damage around the world in 2020. The sickness that’s been going around made it easier for them to do bad things to people and companies. If a business has a website or uses a computer, it’s really important for them to have a special insurance called Cyber Liability.
There are bad people who try to steal things from businesses using the internet, and during the pandemic, there were even more of them. They tried to steal more money than before, too. So now, having Cyber Liability insurance is very important to keep businesses safe.
If your business doesn’t have Cyber Liability insurance, it could lose a lot of money. But not all Cyber Liability insurance is the same – some only cover a little bit, while others cover a lot of things like hacking or fraud. When talking about Cyber Liability insurance, make sure you and your agent know exactly what it covers.
Employment Practices Liability
If you have people who work for you, it’s important to make sure you have protection in case something unfair happens at work. Last year, lots of people filed complaints about being treated unfairly at work. Lawyers think there will be more lawsuits in 2020 because of Covid-19. Some people are suing their bosses for treating them unfairly because of their disability, age, where they come from, or because they were fired for no good reason.
If someone says your business did something wrong when it comes to hiring or treating employees, this special insurance can help pay for a lawyer to help you and cover other costs. Sometimes people are treated unfairly at work, whether they are not hired or fired for reasons that are not fair, or if they are treated differently because of who they are. This is called discrimination. There is also something called harassment, which is when someone is treated badly or made to feel uncomfortable because of who they are.
Sometimes people are not paid the right amount of money for their work, which is also not fair. Businesses can protect themselves from being blamed for these things happening by getting insurance that covers them if it happens to their employees or even if it happens with people who are not employees of the business. Even though businesses try to be fair, sometimes people accuse them of being unfair. This special insurance can help pay for a lawyer to defend the business if someone makes this accusation.