Business liability insurance offers protection to a company’s owner in the case of a formal lawsuit or regarding any claim by third-party. Usually, the formal lawsuit or third-party claim on a company may arise due to injuries or damage which the business is found to be responsible. This form of insurance offers coverage for any financial liability which the company has incurred. Furthermore, this insurance covers the costs of legal defense as well as any settlements in case the lawsuit is judged against the insured company. Some of the costs associated with the legal defense of the company include compensatory damages, punitive damages, and non-monetary losses incurred by the injured party.
General Liability Insurance
This type of insurance offers protection to a company’s assets and also pays for obligations incurred if the third-party gets hurt or when there are property damages caused. The insurance also covers the costs of legal defense and settlements of a lawsuit in case the company is found legally liable by the court of law.
Furthermore, the insured company is protected against any liability as a tenant in case damage is caused to the rented property, for instance, by fire or any other associated losses. This insurance also covers claims of false or misleading advertising such as copyright infringement, libel, and slander. In general, the main claims which are covered in this type of insurance are injury to persons, damage to property, medical expenses, and injury from false or misleading advertisement.
Other Forms of Insurance Coverage for Business Liabilities
Umbrella Liability is a form of insurance which covers your business outside your existing business policy. For instance, this insurance may cover your company when it is found legally responsible for causing injury to third-party or property both locally and internationally. As such, this coverage covers a broader range of injury and may be useful to certain businesses.
The other common form is liability relating to directors and officers of your business. The officers and directors of your company play a vital role in making the decisions to spur the company to high heights. However, the decisions made by these individuals may sometimes lead to mistakes, which may cost your business or even cause injury to third-parties. This means that the directors and top business officers may face legal suit for being responsible. An insurance coverage of the top officers and directors of your company may help avoid the case of resignation and hence keep your business running. Under this type of liability insurance, these individuals are protected from being exposed to lawsuits that your company may face due to their decisions. The insurance covers for the financial losses that your business may face as well as the cost of legal proceedings arising from such lawsuits.
Other forms of liability may arise due to errors as well as omissions during the provision of professional service. Proper insurance coverage is, therefore, ideal for the individuals who are exposed to minor and moderate risks of errors and omissions. The coverage offered here relates to financial losses due to delivery delays, errors during design, breaching a contract, as well as giving inaccurate information, etc.
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