FRIDAY, FEBRUARY 26, 2021
General liability is one of the biggest sources of lawsuits for businesses across industries and sizes. This refers to common accidents involving non-professional negligence, such as a guest slipping on the floor of your restaurant. General liability insurance is designed to protect your business—and other parties involved—in case of such an accident.
There are a few different areas of general liability:
Property Damage: This provides compensation if someone else’s property is damaged due to regular business operations.
Products Liability: This liability coverage protects the business in case a lawsuit arises due to injury or accidents caused by a product.
Completed Operations: This coverage is especially useful for companies in construction and other service industries. It protects the business if injury or damage arises from something made or provided by the company. For example, if your company installs a fridge which later falls and injures the client.
Personal/Advertising Injury: Personal and advertising injury refers to damage your business may cause through libel, slander or advertising.
Lawsuits are expensive, so you will want to file an insurance claim so that your company’s assets aren’t drained in case a claim occurs. You can’t wait too long to file a claim, however.
The time you have to file a claim depends on the claim itself and the type of policy you have. With liability insurance, you generally have two choices for your policy: claims-made or occurrence. General liability policies are typically occurrence policies, meaning the claim is only covered if the incident occurred while the policy was in place. With a claims-made insurance policy, the coverage only steps in if the claim is filed against the insured while the policy is active, regardless of when the actual incident occurred. There are benefits to both types of coverage.
If you are sued, states may require you to respond to the claim against you within a certain period of time. This period is often 20 days but can vary per state and situation. It is during this time that you should file a general liability claim by calling your insurance agency. Be sure to have information ready to file the claim.
1. Your contact information
2. Name of the insured (company name, for example)
3. Policy number
4. Date and location of the incident
5. A detailed description of the incident
6. Any documentation that can be used to approve the claim
If the incident involves bodily harm or injury, be sure that the victim receives medical attention first and foremost. After filing a claim with your insurance agency, the victim may receive compensation for medical expenses.
There are instances where an insurance company may deny your claim. Intentional or criminal acts will not be covered under a general liability policy, nor will incidents that occur outside of the scope of work. General liability is different than professional liability, and claims made due to negligence on behalf of your or the business likely won’t be covered with general liability. It also does not cover employee injuries. If an employee is injured at work, it’s critical to have workers compensation insurance in place to ensure they receive medical treatment and wage compensation, if necessary.
Should I Always File a General Liability Claim for My Business?
Aside from when to file a claim, there is often the question about whether or not you should file a claim in the first place. Filing a claim can raise your insurance rates, after all, so you want to avoid filing a lot of claims, especially within a short period of time.
However, when other parties are involved such as customers, it is almost always a good idea to file a general liability claim.
Even without filing a general liability insurance claim, it is important to keep your insurance agent in the loop about accidents and possible lawsuits. This makes sure that your insurance agent is ready for if you do have to file a claim and keeps them aware of accidents.
Keep in mind that insurance providers don’t necessarily want you to file a claim, either. You can ask your insurance agent about your options before filing a claim, as insurance providers also want to prevent paying out large amounts of compensation.
When in doubt, contact your insurance agent. They can help you navigate a claim so that you can protect your business in case of an accident or possible lawsuit.
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