How Much General Liability Insurance Does My Small Business Need?

Every business large or small faces a variety of dangers when it comes to operation. One of the main dangers is liability, which protects your business against claims such as bodily injury and property damage. The amount of coverage you need may vary, however. 

Your business’ industry is just as important as the size of your company. Some industries have higher risks of accidents than others. Industries with physical locations, for example, typically pose higher general liability risks than a purely online store. 

If your business has been in operation for a while, take a look at your company’s claims history. If you have a long history of claims, you may consider raising how much general liability insurance your business needs. Higher limits can help you avoid reaching the policy’s claim limits.  

What Does General Liability Insurance Cover? 
General liability insurance covers three main areas: 

• Bodily Injuries: General liability insurance can help cover medical bills a person may face due to an injury on the business’ property. It can also cover the business’ legal expenses in case of a lawsuit regarding the injury. 
• Property Damage: Property damage coverage helps compensate those whose property is lost or damaged due to the business’ negligence, as well as covering related legal costs the business may face. 
• Personal and Advertising Injury: Personal and advertising injury covers primarily non-physical claims. This includes coverage for claims concerning libel, slander, malicious persecution, copyright infringement, theft of another’s advertising idea and more. 

Additional coverage can be purchased for businesses that need it, as well as policies that can fill in gaps in a general liability insurance policy such as umbrella liability insurance. 

For most businesses, insurance agents recommend a business owners policy. This type of insurance policy combines general liability insurance and commercial property insurance into a flexible policy specifically geared for small businesses. It allows small business owners to adjust limits, add coverages and tailor deductibles to their business’ needs. 

Shop around and compare quotes between multiple insurers to find the best insurance for your business. Liability can help in case of an expensive lawsuit, so it is important to have the right amount of general liability insurance to protect against financial loss related to an accident. Speak with an insurance agent about your business’ risks and tailor a policy for your company’s specific coverage needs.