Liability Insurance: Can You Afford The Risk?
Without liability insurance a small business runs the risk of potentially losing far more than it can afford to lose. Every business is susceptible to contractual and legal restrictions and conditions and must comply with these obligations. Having adequate insurance coverage can make the difference between increasing or closing down a business if it is hit by an insurance claim.
What Is Liability Insurance?Every business, by law, is held responsible for any injury caused to an individual through interaction with the business. This liability could come from business premises, maintenance, services or other ways of operating a business.
Specialist liability insurance provides insurance coverage against a possible bodily injury lawsuit - for instance personal injury caused to an individual who trips or falls whilst on the company premises or property. Professional liability insurance, on the other hand, only provides insurance coverage for professional services provided. Business liability insurance covers many trades and professionals and can provide suitable cover for public, employees, contractors or product liability.
Basic RequirementsBuying general liability insurance coverage, as part of a commercial policy package, is something all small business owners should seriously consider. The business owner should always carefully read and check all coverage provision and exclusions to ensure their business needs are covered by the liability insurance they are purchasing. A standard liability insurance policy may not provide adequate professional liability protection, and it may therefore be worth considering additional policies to run alongside existing insurance cover.
What To ConsiderA successful business owner must calculate all risks his/her company takes. This includes assessing the cost of potentially expensive claims, by analysing the possible insurance risks to all assets. Being prepared for any eventuality will enable the businessman/woman to make informed choices over which type of liability insurance coverage to consider. General liability premiums are based on a combination of sales, payroll and line of business, and offer protection against claims made for injuries to employees or clients whilst they are on the business premises, property, or involved on company business.
Service liability insurance protects the policyholder in the event that the company is sued, by a client who is dissatisfied with a product or service the business provides.