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What is General Liability?

General liability insurance covers a business against third-party bodily injury and property damage claims due to the business product or service.

Most companies need general liability to satisfy contractual requirements and protect their business against liability claims.

As an independent insurance agency invested in and committed to improving the customer experience, Fortis Insurance Partners is making it quick, easy, and affordable to get the proper coverage.

What is General Liability?

General liability insurance, sometimes called Business Liability, provides coverage against third-party claims, including bodily injury, property damage, and personal and advertising injuries.

These are often the most common risks associated with running a business.

Third-party bodily injury applies to customers injured from an accident involving your business operations. A general liability policy will cover the cost of medical expenses and legal expenses if the customer decides to sue.

For example, a customer slips and falls while on your premises. The injury requires medical attention. Your policy will cover those medical costs. The policy will also cover the associated legal fees if the customer decides to sue.

If your business operations cause damage to another person’s property, general liability will cover the third-party property damage claims. Including the cost of repair or replacement and legal fees, if necessary.

For example, a handyman improperly installs a new sink faucet, resulting in a water leak that damages the cabinets and wood floor. The damage is severe and requires the cabinets and floors to be replaced. A general liability policy will pay for the replacement of the damaged property and any resulting legal fees.

Personal and advertising injuries refer to claims associated with violating a person or business’s personal or intellectual rights.

For example, a business uses a copyrighted picture on its new website without the owner’s permission. The owner of the copyright decides to sue for damages. A general liability policy would cover the legal fees and settlement costs.

Do I need general liability?

General liability insurance is typically not required by law. But that doesn’t mean it’s a good idea to forego coverage.

General liability provides coverage for many of the most common risks associated with running a business.

Without coverage, a business is leaving itself open to financial risk. In addition, business owners are often required to carry general liability by vendors, clients, or lessors to conduct business.

How much does general liability cost?

Several factors determine general liability premiums, including the type of business, claims history, location, number of employees, and much more.

Depending on the industry, or insurance carrier, sales or payroll are the standard rating basis. Premium is calculated as rate times rating basis (usually sales or payroll) divided by 1,000.

For example, if the rate for your type of work is $3.00, and you expect to generate $1 million in sales over the policy period, your GL premium will be $3,000 ($3 x $1,000,000 / 1,000).

Why Fortis?

As an independent insurance agency invested in and committed to improving the customer experience, Fortis Insurance Partners is making it quick, easy, and affordable to get the right insurance coverage.

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The information on this page should not be construed as specific legal, HR, financial, or insurance advice and is not a guarantee of coverage. In the event of a loss or claim, coverage determinations will be subject to the policy language, and any potential claim payment will be determined following a claim investigation.