General liability insurance for small businesses

Protection ins and outs

General liability insurance, small business liability insurance, commercial general liability insurance - they're all names for the same coverage.

And, if you want protection against claims you've damaged someone's property or injured someone, it's coverage you need.

The good thing is you can cover damage to your own property, too. Business personal property insurance (BPP for short) means coverage for the things in your office and the bits and pieces you take out and about, One policy, zero worries.

• What is small business general liability insurance?

  Small business general liability insurance protects your business from the cost of claims for:

  • Injury to a customer, vendor, or someone else
  • Damage to someone else’s property (including property you rent, or to electronic data)
  • Personal injury (writing or talking about someone in a false, or unflattering way)
  • Advertising injury (copyright infringement or stolen ideas)

  You can buy general liability insurance as a standalone policy.

  Or bundle it with other coverages in a Business Owner's Policy (BOP).

• Who needs general liability insurance?

  You need general liability insurance if you:

  • Visit with clients, or they visit you
  • Have access to a client’s property (e.g. a server)
  • Need coverage to enter into a contract
  • Use advertising to promote your company.

  Why? Because accidents happen. All it takes is for someone to trip over a computer cable in your office and break their ankle, to find yourself facing a claim.

  And without insurance, that’s going to cost you. Medical expenses are on the up. And the legal costs of a claim, plus compensation, could be enough to put a small business out of business.

  General liability insurance can take care of these costs for you. It means your business doesn’t slip up, even if someone else does.

• What does general liability insurance cover?

  General liability insurance covers:

  • Medical expenses – if someone (other than you or an employee) is injured, your policy can cover medical expenses up to $5,000 for each injured person
  • Repairs or replacement – if you, or one of your employees, damages someone else’s property, general liability insurance can pay for repairs, replacement, or reimbursement, including delivery costs.
  • Legal costs if a claim is filed against your business – including hiring an attorney, your legal defense fees and compensation, if you’re found at fault.
  • Actions by your employees – not just your full-time staff, but part-time employees, too.
  • Electronic data – up to $25,000 of coverage for damage to or loss of someone’s electronic data
  • Extra expenses – your general liability policy can take care of the hidden costs of defending a claim. On top of your defense costs, it can pay up to $250 a day for loss of your earnings and reasonable expenses.
  • Worldwide coverage – as long as the claim is filed in the Canada, the U.S. or one of its territories.

• How much does general liability insurance cost?

  The cost of general liability insurance can vary, depending on:

  • The size of your business
  • The industry you’re in
  • Payroll cost
  • Annual revenue
  • The amount of coverage you need

  To give you an idea, here’s an example of general liability costs by location and profession:

  	IT Consultant	Business Consultant
  State	CA	TX
  Annual payroll	$100,000	$200,000
  Maximum amount insurer will pay for a single claim	$500,000	$1,000,000
  Maximum amount insurer will pay for all claims	$2,000,000	$2,000,000
  Deductible	$0	$0
  Monthly cost	$29.17	$29.17
  Annual Cost	$350	$350

  The higher your limit (the amount your insurer will pay for a single claim or all claims during the policy period) the more your policy costs. So choose your limit carefully.

  Just remember that lawyers’ fees, compensation and court costs can go through the roof. Try to imagine the worst-case scenario, then pick a figure you can realistically afford.

  And remember there are payment options, too. So you can spread the cost of your policy to fit your budget.

• Why do I need BPP insurance?

  If you’re buying a general liability insurance, you can add business personal property coverage (BPP) to your policy. It’s a good idea, because general liability insurance doesn’t cover damage to your own property.

  BPP covers your portable office equipment. That’s basically anything you can move in your office from your office desk to your potted plants.

  Plus anything you take with you when you’re out and about on business. Like your mobile, or laptop.

  Think about it. All these things are essential to running your business. Ok, maybe not your potted plants. But your mobile or laptop mean you’re ‘in the office’ even when you’re not. And when you’re out and about, there’s more of a risk these essentials can get lost, stolen or damaged.

  And then what? You could lose business, that’s what.

  The same goes for the tools of your trade. If they get lost or stolen, you’ll spend time and money trying to replace them. And if jobs get held up, clients could get fed up…

  If you’ve got BPP insurance, you might lose your stuff, but you won’t lose business.

  Read our blog post about business personal property coverage, or call us on 978.344.4215 to find out more.