What Should I Know About Liability Insurance for My Business?
June 25, 2021
Texans who are starting a business will be excited about the future and the opportunity to share their goods and services with the public. Regardless of the kind of business that is getting off the ground, there are fundamental requirements that must be adhered to in ensuring it is in full compliance with the law. This goes beyond avoiding sanctions from the government. It extends to protecting the business if unforeseen incidents occur. Having commercial general liability (GCL) insurance is something that could recede to the background amid other concerns, but it should be of primary importance.
Understanding CGL Insurance and Why It Is Necessary
CGL insurance is in place to shield business owners from being held liable for various issues that might come up as they conduct business. That includes people being injured on the business itself, damage to property, if there are allegations of false advertising or if someone claims they were slandered. There are different forms of coverage. If it is premises/operations coverage, it will cover damage or injuries that happen on the property or due to the company’s business operations.
Products/completed operations coverage will protect the business if there is a bodily injury or damage to property that happened away from the business location or happened when using the company’s products or after work had been completed. Many companies are advised to get excess liability so any losses that go beyond the limits on the basic policy will be covered. An umbrella liability extends beyond CGL and automobile liability while simultaneously covering for costs that were not part of the basic policy or the umbrella liability.
Business Formation Legal Professionals Can Help with These Issues and Others
During business formation and planning, this type of insurance may not seem crucial at first. But, for example, if a product the company creates and sells is alleged to have resulted in customers becoming injured or ill, the subsequent lawsuits that may be filed as well as damage to the company’s reputation can be severely problematic. To avoid having a business come apart because of a failure to have the required coverage and more, it is critical to understand CGL and other forms of insurance that businesses might need. This is only one area of operating a business that must be factored in. There is a seemingly endless stream of others. Having help from professionals experienced in these matters can protect the business and its owners from the beginning.