Read on to find out what liability insurance is and why you are going to need it.
When you’re running a business, there are lots of rules and regulations to sift through. While many may be irrelevant to your enterprise, it’s vital to know which policies apply to your business. Although many new companies are unfamiliar with liability insurance, it’s highly likely you’re going to need it. In fact, the vast majority of businesses are required to have liability insurance to operate legally.
If you’re launching a new enterprise or planning a career as an entrepreneur, read on to find out what liability insurance is and why you’re going to need it.
What is Liability Insurance?
If you cause someone else to suffer an injury, you are generally liable for the harm they’ve experienced. Similarly, if you damage someone else’s property, you’re liable for the cost of repairing or replacing it. In the same way, your business can be held liable for any damage, injury, illness or loss that is caused by your business activities.
A customer could slip on a wet floor and suffer an injury while shopping in your store, for example. If you’re held liable, there’s a good chance you’ll be required to pay for the cost of their medical treatment, as well as compensation for the harm they’ve suffered and the loss of earnings they’ve incurred due to the injury.
Liability insurance protects your business from these types of claims. When someone takes legal action against your business, liability insurance can cover the cost of any pay outs which need to be made, as well as covering the cost of your legal representation.
Finding the Right Liability Insurance
Selecting liability insurance cover can seem overwhelming at first, particularly if you’re a new business owner, or you’ve never purchased this type of policy before. By working with established commercial insurers, like The Hartford, you can access the information and guidance you need. Often, different types of liability insurance can be obtained under just one policy, which makes it easier for you to access the level of cover you need. With dedicated policies for small businesses and specific professions, you’ll find it easy to choose the right type of insurance for your enterprise.
Researching different types of insurance may not be the most exciting business activity, but it’s one of the most important. By doing so, you’ll ensure you’re meeting your legal obligations and giving your business the protection it needs and deserves.
What Type of Liability Insurance Do You Need?
As there are different types of liability insurance, you’ll need to decide which ones are right for your business. At a minimum, most companies are required to have auto liability insurance and workers’ compensation insurance. However, general liability insurance, bodily injury liability insurance, property damage liability insurance, and product and service liability insurance may also be relevant to your business.
In addition to this, professional liability insurance, cyber liability insurance, and Directors and Officers liability insurance may also be necessary, depending on your business activity. Due to the range of liability insurance policies on the market, it’s essential to get specialist advice before taking out cover.