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Liability Insurance

Types of liability insurance for small business

By February 21, 2022No Comments

Liability insurance policies for corporates and businesses are one of the best-selling insurances in the leading companies. But do you know what makes liability insurance plans so essential? There is more than one liability insurance policy for corporates and businesses. In this article, find out more about the types of liability insurance, their importance, and the right choice for small businesses when it comes to selecting an extensive liability insurance plan. 

Different insurances for different liabilities

Running a business is not easy as there are multiple things to focus on. The liabilities are also diverse with each business type. But you can never find a business, be it a small or a large-scale, running without liability risks. It can be related to products, property, clients, stakeholders, and consumers. For example – D&O and PI insurances can be essential for a business depending on the operations. So, you can understand that every liability requires a separate management plan to ensure optimal business operation. Thus, businesses buy more than one liability insurance coverage so they can find financial support in times of emergency and crisis. 

What about small businesses?

There is a large gap between the resources and assets of a small-scale and large-scale business. But does that mean small businesses do not necessitate having liability coverage? No. Every business necessitates liability insurance to meet the needs in emergencies. A large-scale business, depending on the specific industrial domain can purchase more than one liability insurance. But a small business has to manage it with a compact solution for liability coverage. For identifying the right coverage, one has to stay clear about the different types and, their utility in the business running. 

Different types of liability insurance policies

Are you a small business owner who is looking for a liability coverage plan for the business? You cannot decide on the right insurance plan unless you are aware of the varied types, utility costs. Here’s making your task of finding liability insurance easier by specifying the types available in the market. 

  • Public liability: Public liability insurance helps in meeting legal expenses and other compensation charges brought by anyone not related to the company. It is a third-party liability, who may or may not be your client or consumer. It covers incidents like accidental property collapse, physical damage for poor maintenance, environmental pollution for business operations, etc. The insurance pays for the expenses for defense proceedings and medical charges in case of bodily injuries. 
  • Product liability: A product-based business can gain largely through product liability insurance. Insurance is a one-stop solution to all product issues that a company may face. It includes coverage benefits for all product-related risks and litigation cases. Injury, disease, harm, damages, or any other concerns caused by the product of your business can create a ground for a user or any third party to bring legal allegations against your business brand. There can be heavy penalty imposition. In such times, the product liability insurance meets the expenses and helps you recover from the loss. 
  • Employer liability: An employer liability refers to all the responsibilities and duties of the employer in the business. For example – If an employee working under you faces an accident while working at the business factory, then the duty is upon you to meet the expenses. Group healthcare policies are a good example that will help you understand how employer liability works. 
  • Third-party liability: A third-party liability may include any damage or injury caused by the insured (the business in this case) to anyone who may or may not be associated with the company. Accidental cases can also fall under this liability sphere for which the insurances offer extensive coverage. Commercial general liability insurance is an apt example of third-party liability insurance. Here you get compact coverage for different types of public and product-related issues.  
  • D&O liability: Liability coverage for the directors and executive officers in a company is essential. The insurance caters to them and covers the legal expenses incurred due to defending themselves at the court. The litigation charges may be brought by clients, employees, stakeholders, and colleagues for the poor management or action of the professionals. 
  • Professional indemnity: Professional indemnity insurance covers the business and the professionals in the company against any legal claim, initiated by the client. The clients can legally charge the company or responsible personnel for their incompetent service or consultation, leading to a loss on their part. Unlike D&O policy where the insurance only covers the director or officer in the company, here the business and professionals can get coverage. 

Comprehensive insurance for small businesses

Now that you know the various types of liability insurances available in the market, which one do you think would be right for a small business? A small business always requires a compact package through which most liability concerns can get coverage. Thus, commercial general liability insurance is a fitting choice for a small business. 

Coverage and benefits of CGL insurance

Commercial general liability insurance can be referred to as a combined offering of public and product liability. Thus, any business irrespective of the functioning domain can opt for the insurance policy. Under the CGL insurance policy, you get coverage for the following reasons –

  1. Third-party injury coverage – Non-employee and consumer injury coverage
  2. Immediate medical expenditure coverage for third-party 
  3. Settlement charges, repair cost, recovery expenses for destroyed property
  4. Damage recovery cost for product issues and legal cost for defending
  5. Advertising injury protection, copyright infringement coverage, etc. 

A cost-effective and affordable deal

The best part of purchasing CGL insurance is that you can also add features based on your budget and preference. If you consider a base insurance plan, it is a cost-effective deal for any small business. It provides a long-term advantage and keeps you financially stable in most emergencies related to public and product liability. 

Protect the business by knowing the inclusions and exclusions

When you purchase a liability insurance policy, it is crucial to know in detail about the coverage inclusions and exclusions. Industry-specific liability insurance policies have several coverage aspects that need guidance from an expert. Even if you buy general liability insurance, you must find a reliable insurance broker who can explain the terms and regulations in detail. 

Identify the right choice for your small business.

Get a suitable combination of price and coverage features while purchasing the CGL insurance policy. An insurance broker with in-depth field knowledge can bring the best liability policies for small businesses, so you get a cost-effective deal.

PlanCover – Assisting you in each step.

PlanCover, your most-trusted insurance broker company, has all the answers you need. The expert team from PlanCover offers the best liability insurance policies for small businesses. All you require is to give them a ring to discuss what you require in the insurance policy. PlanCover offers business insurance from the leading companies and brings the best deal to meet your requirements. Get in touch with an efficient team of insurance experts.  

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