February 1, 2022
Agency
The Costs of General Liability Insurance
All businesses need to protect themselves with insurance. Among your coverage should be general liability insurance. This form of coverage can provide protection if your business is held responsible for injuring a third party or damaging their property.
Liability coverage comes in many shapes and sizes. You should work with your agent to set up a policy that targets your specific needs. Even so, the policy will still come with various costs. Keep reading to learn more about general liability insurance and its associated expenses.
Liability Insurance in a Nutshell
A liability is any risk that your business poses to another party. Liability insurance, therefore, can help you compensate someone your business harms. It’s easy to see why businesses need this coverage. Should a third party, like a customer, sue your business for damage, such a policy could offer much-needed assistance.
Let’s say someone falls and sprains their ankle while visiting your commercial property. They might sue your business, or request help covering their medical bills. With liability coverage, you can help pay the affected customer for their losses, as well as protect your business against potential legal expenses.
The Costs of Liability Coverage
Even with a solid liability insurance policy, there are several coverage costs for your business to consider. This includes the following:
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Some general liability policies have deductibles, while others don’t. This is the price you pay for damage before your policy will provide payment. At times, requesting a deductible for your policy might save you money on your premium costs. This can be an important savings tool. Ask your agent if you can add one.
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Most liability policies will have exclusions. Exclusions are incidents of damage that receive no coverage. You’ll have to pay the full cost of these damages unless you have additional insurance for those losses.
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All policies will come with coverage limits. This is the maximum amount of money you can receive in the event that you make a policy claim. Usually, limits start at around $1 million in coverage and can increase from there. If you have a claim that exceeds your maximum coverage limit, you’ll only receive the maximum, at most. That means you could face costs if you don’t have enough coverage.
Because claims might still lead to out-of-pocket costs, talk to your agent about how to mitigate these expenses. Your agent can help you secure customized, affordable coverage.