Accidents happen, most of the time in the most unexpected way. Say a guest slips in your restaurant and twists their ankle. You call for medical assistance immediately, but the guest is furious and doesn’t want to pay for the medical expenses. What do you do?
Every business should have general liability as part of their insurance policy. This coverage provides compensation for bodily injury or physical damage you may directly or indirectly cause to someone else. It offers medical expense assistance as well as helps with legal expenses relating to lawsuits. General liability often comes in bundles, such as when it is paired with property coverage as part of a business owners policy.
There are a few different areas of general liability:
- Bodily Injury: This provides compensation if a guest or client obtains an injury due to regular business operations.
- Property Damage: This provides compensation if someone else’s property is damaged due to regular business operations.
- Products Liability: This liability coverage protects the business in case a lawsuit arises due to injury or accidents caused by a product.
- Completed Operations: This coverage is especially useful for companies in construction and other service industries. It protects the business if injury or damage arises from something made or provided by the company. For example, if your company installs a fridge which later falls and injures the client.
- Personal/Advertising Injury: Personal and advertising injury refers to damage your business may cause through libel, slander or advertising.
Say one of these coverages has been called into question and your business faces a lawsuit. Lawsuits are expensive, so you want to file an insurance claim so that your company’s assets aren’t drained. The time you have to file a claim depends on the claim itself and the type of policy you have. With liability insurance, you generally have two choices for your policy: claims-made or occurrence. General liability policies are typically occurrence policies, meaning the claim is only covered if the incident occurred while the policy was in place. With a claims-made insurance policy, the coverage only steps in if the claim is filed against the insured while the policy is active, regardless of when the actual incident occurred. There are benefits to both types of coverage.
If you are sued, states may require you to respond to the claim against you within a certain period of time. This period is often 20 days but can vary per state and situation. It is during this time that you should file a general liability claim by calling your insurance agency. Be sure to have information ready to file the claim.
- Your contact information
- Name of the insured (company name, for example)
- Policy number
- Date and location of the incident
- A detailed description of the incident
- Any documentation that can be used to approve the claim
If the incident involves bodily harm or injury, be sure that the victim receives medical attention first and foremost. After filing a claim with your insurance agency, the victim may receive compensation for medical expenses.
There are instances where an insurance company may deny your claim. Intentional or criminal acts will not be covered under a general liability policy, nor will incidents that occur outside of the scope of work. General liability is different than professional liability, and claims made due to negligence on behalf of your or the business likely won’t be covered with general liability. It also does not cover employee injuries. If an employee is injured at work, it’s critical to have workers compensation insurance in place to ensure they receive medical treatment and wage compensation, if necessary.