What is Business Liability Insurance?


Insurance is a word that we hear often in many different fields. Car insurance and health insurance are two of the more well known types. Business liability insurance is less common due to the fact that not everyone owns a small business. However, it is equally important as other kinds of insurance. Let’s dive into what liability insurance is. In car insurance, liability insurance covers the driver in the event that they were to get involved in an accident. Business liability insurance works in a similar way. This type of insurance protects business owners and/or companies. What exactly does it cover? Each insurance is designed to cover specific things and a business liability insurance covers things such as lawsuits, as well as other events that may derive from your business operations such as bodily injury, property damage, etc. Many liability insurances will even cover legal expenses, assuming that legal help is needed in order to resolve the issue at hand. 

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Can You Get Liability Insurance Without a Business License? 


In most cases, business owners will register their business, obtain the necessary licenses, and then proceed to obtain the liability insurance for it. However, there are some businesses that are not registered or licensed. Regardless of that, every business needs to be insured whether they are registered or not. Ideally, a business should be both licensed and insured. Another thing to keep into consideration is that there are different rules and regulations that can vary depending on where you live. It is recommended that you speak to your insurance provider or an attorney. Doing so will help you make sure that your business is fulfilling all responsibilities and requirements required by law. 


Does Business Liability Insurance Cover Theft? 


In business liability insurance there are three parties involved. The first is your business. Second is the insurance company, and the third is anyone who files a claim against your business. Business liability insurance is considered third party coverage. This means that your liability insurance will cover your business from claims that are filed against you or your business. If something is stolen from your business then it would be considered a first party loss. Unless your business is somehow responsible for theft of someone else’s property, theft is not normally covered with business liability insurance. 


What Does Business Liability Insurance Cover? 


As mentioned in the previous section, business liability insurance is a third party coverage. In reality, there are infinite scenarios that can be used to give examples of what kinds of things liability insurance covers. The most important thing to remember is that business liability insurance covers your business’ liability to pay compensation to a third party. This can be due to personal injury and also property damage. For example, if you have a painting business and one of your workers spills paint on the customers property, your business liability insurance should cover that. Of course, the insurance will only cover this if you are found liable for whatever damage or injury occurred. In some cases, the insurance won’t even need to come into play depending on the situation. 


Do I Need Public Liability Insurance For a Cleaning Business? 


Yes. As is the case with most businesses, you will need public liability insurance for your cleaning business. If you accept to do work for another business such as an apartment complex or any commercial business, they will require proof of liability insurance prior to beginning the work. Ultimately it is there to protect you and your business. Something as simple as not putting up a wet floor sign can result in a significant financial loss to your business. 


Do I Need Public Liability Insurance For My Online Business? 


Yes. You may be asking yourself why you need liability insurance for your online business if it is all online. Even though the majority of your business may be online, more than likely there is a center from where you physically run your business. This could range anywhere from an office to a personal home. If ever there is a customer present at that location, the liability insurance will protect any bodily injury that may occur during that visit. Additionally, many online businesses offer products or services. The liability insurance will also cover you in the case of a potential lawsuit due to a faulty product or any other grounds for a lawsuit. Lastly, most businesses have an online data base with personal information their customers have provided them. In the event that a hacker or anyone else were to get ahold of that information, the public liability insurance would cover that as well. Ultimately, all business should have public liability insurance. It is better to have it and not need it, than to need it and not have it. 


Liability Insurance


Starting a new business can amount to various feelings of excitement and overwhelming as new responsibility has now emerged into a business owner’s life. Many of these responsibilities to take into consideration include foundation aspects of a business such as liability insurance. Liability insurance is the protection against claims if and when a person is injured or property is damaged which can result in payout if the business is found liable for the actions. Liability insurance typically pays the third party and not policyholders and does not cover intentional damage.


How Much Is Liability Insurance For A Business?


Liability insurance for a business varies in price depending on the income and profession of the business itself. For example, the general medium for liability is around $45 dollars per month. The rate of this cost may increase if the business has multiple components such as greater premises or more equipment. These are typically known as high-risk businesses. Simply meaning that their general liability insurance is increased due to the fact that the business has more liabilities and areas that need coverage. If say for example, a small landscaping business pays an average of $45 dollars a month or around $540 yearly, higher-risk businesses are potentially and most likely looking at $600-$1000 in liability insurance cost. 


Is Business Liability Insurance Required By Law?


General liability insurance isn't necessarily mandatory or required by law in order to run a business. However, it is highly recommended for all businesses to have some type of general liability insurance in the case that if something were to occur that business would have some type of protection.


Do I Have To Have Liability Insurance For My Business?


Liability insurance is recommended as a means of protection for a business against any injury or property damage. Although it is not enforced by law , Liability insurance may be able to save a business thousands of dollars if a person were to get injured or damage to the property was done unintentionally. Without Liability insurance, the risk of getting sued for much more than was justifiable is high and very likely to occur.


How Much Business Liability Insurance Do I Need?


The amount of Liability insurance for a Business depends on the size of the business itself. For larger businesses that contain more equipment and have more personal on a grander premise, a full coverage general liability may not be enough. Higher risk businesses tend to pay more than average for general liability insurance and usually have to get a professional liability insurance. As for small businesses a full coverage liability insurance which is typically $45 dollars a month is enough to get a business started and later build off of.


What is The Best Liability Insurance for a Small Business?


The Best Liability Insurance for a Small Business would most likely be a General Liability insurance. This type of insurance covers most natural disasters, workers compensation , personal property and income. When paired with Business Property insurance and Business Income Insurance , a typical general liability insurance is a great option for a small business to set up a substantial safety net against any claims that may damage a business. The cost of insurance for a small business typically ranges between $500-$800 yearly and allows the business to expand alongside it .


How To Get Liability Insurance For A Small Business?


When looking for a liability insurance for a small business the owner must take into consideration the entirety of their businesses. What liabilities they have and what works for their budget. From there they may begin looking at a reputable insurance agent to assess in searching for policies that match the businesses needs.