Commercial Liability Insurance: What Is It & What Does It Cover?

 In Commercial Liability Insurance

Commercial liability insurance plans are financial reimbursement policies every company needs, whether it’s a startup, small business, or a large corporation. These plans differ from Commercial General Liability (CGL) plans by offering custom solutions insurance brokers design around specific needs based on various factors associated with the company. 

Given the nuances around this topic, please continue reading to learn more about commercial liability insurance, what it covers, and how to find an insurance partner that makes a difference. 

What is General Commercial Liability Insurance?

Let’s reiterate that CGL policies act as subsets of commercial liability insurance. While CGL policies fall under the same umbrella categorically, many plans related to our primary topic aren’t technically CGL policies. Therefore, it’s best to think of general liability insurance as a broader form of insurance that covers a wide range of liabilities related to non-professional negligence like bodily harm or property damage. 

In contrast, commercial liability insurance is a custom policy that protects a business instead of an individual from professional liabilities. Its primary goal is to offer a safety net to mitigate financial losses under qualified instances and the distinct professional needs of the company. 

Those situations could differ based on the following elements within a plan. For example:

  • The underwriting
  • Potential business risks
  • Policy
  • And numerous other factors

Still, commercial liability insurance generally includes coverage intended to protect a company’s financial well-being when legal liability is at stake. The choice between the two types of coverage depends on the nature of the business and the factors listed above. 

If you want to learn more about both options, we invite you to speak with an insurance professional to determine the right coverage for your business’s needs.

Commercial liability insurance is a custom policy that protects a business instead of an individual from professional liabilities.

What Does Commercial Liability Insurance Cover?

Unfortunately, legal liabilities are surfacing more frequently, costing businesses $1.2 million in litigation expenses annually. In turn, more companies seek ways to potentially mitigate legal losses by leveraging customized commercial liability insurance.

Business insurance like this may help safeguard your company’s finances and reputation in case of accidents or injuries involving third parties under qualified circumstances. Below are a few examples highlighting the essential components of commercial liability insurance to illustrate its usefulness under certain conditions. 

Bodily Injury

Commercial liability insurance may protect businesses by covering medical expenses, legal defense costs, settlements, and judgments related to bodily injury lawsuits against a company. This may include situations where an employee was hurt on the job or while representing the company elsewhere. 

Property Damage

Commercial liability insurance may cover incidents where an employee causes property damage while performing their duties. Alternatively, if your business is responsible for causing damage to someone else’s property, a policy may reimburse the costs of repairing or replacing what was harmed.

Personal & Advertising Injuries

Businesses can work with an insurance broker to design a plan that offers coverage in instances of libel, slander, or wrongful representations of your company. This includes copyright disputes and other advertised injuries. For example, companies use this coverage to protect themselves if a lawsuit surfaces when another steals patented ideas or falsely advertises their brand maliciously. 

Product & Service Dissatisfaction

Some companies enroll in individualized commercial liability insurance for protection against situations where a product or service resulted in harm, caused damage, or surfaced in litigious action. 

Additional Custom Needs & Legal Defense Costs 

While the above examples provide details about the core tenets regarding coverage, many other situations may apply depending on the policy. This might include reimbursements for medical payments or legal defense costs. Partnering with an insurance expert is the best way for any business to discover a plan individualized to its needs. 

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How Much Does Commercial Liability Insurance Cost?

The size of your business, its risks, and various other factors outlined in the underwriting typically dictate the cost of a plan. Still, it’s best to meet with an insurance broker to get exact figures. 

How Do I Get Commercial Liability Insurance?

With the right insurance partner, you can access a policy that may make the difference in preventing significant losses. Fortunately, finding the right solution tailored to your industry is now more accessible.

We know our markets, the programs fitting the specialized spaces we work within, and the strengths of the insurance companies we represent. We invite you to schedule a consultation with a JD Fulwiler insurance expert by filling out our contact form to discuss your options. You can also call us at 800.735.8325—we’re here to support you and your business needs. 

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