To put it simply, general liability insurance protects business owners against legal claims relating to bodily injury, property damage, libel, defamation, and slander made by third-party individuals\u2014that is, your customers, clients, or collaborators.<\/p>\n\n\n\n
The specific types of claims a business is likely to file, as well as the risk of them encountering legal trouble in the first place, varies considerably based on the type of business you run. Perhaps you design or distribute a product and a customer is injured or otherwise harmed by it. Maybe you run an office and a client is injured while on site for a meeting. Or maybe your business requires you to be on people\u2019s properties\u2014such as a professional cleaner, landscape artist, or general contractor\u2014and either you or an employee inadvertently damages their property.<\/p>\n\n\n\n
No matter what kind of work you do, the majority of small businesses that work with customers and rent or own commercial or office space need a general liability policy. That way, when an accident or incident happens, you\u2019re covered for any medical or legal expenses you\u2019re deemed responsible for. In fact, many client contracts specifically require businesses they intend to work with to have this insurance\u2014it\u2019s that foundational. By waiting until you\u2019re in trouble to look for coverage, you\u2019ll end up paying far more out of pocket, potentially even leaving your business bankrupt.<\/p>\n\n\n\n
<\/span>How to get general liability insurance<\/strong><\/span><\/h2>\n\n\n\nWhen you\u2019ve decided you\u2019re ready to get general liability insurance for your business, you may feel unsure where to begin. If you\u2019ve only ever handled insurance for yourself and your personal assets, the broader scope of your business may seem difficult to undertake.<\/p>\n\n\n\n
But fear not\u2014the process is actually pretty similar to shopping for personal insurance. We\u2019ll break it all down into simple steps to make sure you feel well informed and prepared at every point.<\/p>\n\n\n\n
<\/span>1. Evaluate the risk your business poses<\/strong><\/span><\/h3>\n\n\n\nSome types of businesses are more or less risky than others. Being aware of the kinds of risks you\u2019re most likely to encounter in your line of work, and having an estimate of the costs of these lawsuits should they come up, is a good starting point. According to a premium survey done by Insureon<\/a>, the most costly premiums are for businesses in the construction and contracting, cleaning services, landscaping, and food and beverage industries. Knowing this will help you understand the best insurance plan for your business.<\/p>\n\n\n\n<\/span>2. Find an expert you trust<\/strong><\/span><\/h3>\n\n\n\nIt can be challenging to find the best rates and understand the details of insurance policies on your own. Seeking guidance from a trusted commercial insurance agent can give you insight you wouldn\u2019t otherwise have. They aren\u2019t affiliated with any individual insurance company, but receive a commission when they sell policies, meaning they\u2019re perfectly situated to provide unbiased insight into which plan will best suit your budget and needs.<\/p>\n\n\n\n
<\/span>3. Gather quotes<\/strong><\/span><\/h3>\n\n\n\nOnce you and your agent know exactly what your risks and priorities are, identify what kind of plan is best for you. From there, they\u2019ll assist you in gathering quotes from the insurance companies you\u2019ve identified as top contenders for evaluation. At this point, you\u2019ll see exactly what the coverage and cost of each plan is for your business.<\/p>\n\n\n\n
<\/span>4. Evaluate and ask questions<\/strong><\/span><\/h3>\n\n\n\nNow comes the hard part\u2014deciding which option is the best fit for you! Evaluate each option with your business risks in mind to get a clear picture of what your business really needs. Prices and offerings can dramatically vary between plans, but remember: this isn\u2019t the moment to opt for the cheapest option. Make sure you understand each policy clearly and ask a lot of questions. One of the benefits of working with a commercial insurance agent is that their expertise will allow you to make as informed a decision as you possibly can.<\/p>\n\n\n\n
<\/span>5. Enroll and assess annually<\/strong><\/span><\/h3>\n\n\n\nOnce you\u2019re sure which plan is the right one for you, work with your agent to enroll. They\u2019ll walk you through each step. Aside from providing documentation about you and your business, this step should be relatively easy. Once you\u2019re covered, work an annual revaluation into your calendar\u2014as a business grows, so do their liabilities. Staying current will benefit you in the long run.<\/p>\n\n\n\n
<\/span>General liability insurance requirements<\/strong><\/span><\/h2>\n\n\n\nOnce you understand how to get general liability insurance, it\u2019s time to enroll. In order to enroll in this type of insurance, you\u2019ll need to provide your insurance company with some information and documentation related to your business, including:<\/p>\n\n\n\n
\n- Documentation illustrating how long you\u2019ve owned your business<\/li>\n\n\n\n
- An estimate of your business\u2019s revenue for the coming year<\/li>\n\n\n\n
- A description of what your business does<\/li>\n\n\n\n
- Where your business is located and if that location is owned or rented<\/li>\n\n\n\n
- Number of employees<\/li>\n<\/ul>\n\n\n\n
This information will give your provider a complete picture of your business, so they can determine what level of insurance to offer and at what cost.<\/p>\n\n\n\n
<\/span>How much does small business liability insurance cost?<\/strong><\/span><\/h2>\n\n\n\nWhile insurance costs vary, depending on a few factors, small businesses generally pay between $40 and $50 each month, or $480 to $600 annually. The most common coverage for this rate is a $1 million per-occurrence limit, meaning the insurer will cover up to that amount in any individual claim, with a $2 million aggregate limit, meaning the insurer will cover up to that amount per year. While this is the most common policy\u2014over 90% of businesses covered by Insureon<\/a> chose this coverage\u2014around 5% opted for $2 million\/$4 million limits instead due to their business type.<\/p>\n\n\n\n
Some types of businesses are more or less risky than others. Being aware of the kinds of risks you\u2019re most likely to encounter in your line of work, and having an estimate of the costs of these lawsuits should they come up, is a good starting point. According to a premium survey done by Insureon<\/a>, the most costly premiums are for businesses in the construction and contracting, cleaning services, landscaping, and food and beverage industries. Knowing this will help you understand the best insurance plan for your business.<\/p>\n\n\n\n It can be challenging to find the best rates and understand the details of insurance policies on your own. Seeking guidance from a trusted commercial insurance agent can give you insight you wouldn\u2019t otherwise have. They aren\u2019t affiliated with any individual insurance company, but receive a commission when they sell policies, meaning they\u2019re perfectly situated to provide unbiased insight into which plan will best suit your budget and needs.<\/p>\n\n\n\n Once you and your agent know exactly what your risks and priorities are, identify what kind of plan is best for you. From there, they\u2019ll assist you in gathering quotes from the insurance companies you\u2019ve identified as top contenders for evaluation. At this point, you\u2019ll see exactly what the coverage and cost of each plan is for your business.<\/p>\n\n\n\n Now comes the hard part\u2014deciding which option is the best fit for you! Evaluate each option with your business risks in mind to get a clear picture of what your business really needs. Prices and offerings can dramatically vary between plans, but remember: this isn\u2019t the moment to opt for the cheapest option. Make sure you understand each policy clearly and ask a lot of questions. One of the benefits of working with a commercial insurance agent is that their expertise will allow you to make as informed a decision as you possibly can.<\/p>\n\n\n\n Once you\u2019re sure which plan is the right one for you, work with your agent to enroll. They\u2019ll walk you through each step. Aside from providing documentation about you and your business, this step should be relatively easy. Once you\u2019re covered, work an annual revaluation into your calendar\u2014as a business grows, so do their liabilities. Staying current will benefit you in the long run.<\/p>\n\n\n\n Once you understand how to get general liability insurance, it\u2019s time to enroll. In order to enroll in this type of insurance, you\u2019ll need to provide your insurance company with some information and documentation related to your business, including:<\/p>\n\n\n\n This information will give your provider a complete picture of your business, so they can determine what level of insurance to offer and at what cost.<\/p>\n\n\n\n While insurance costs vary, depending on a few factors, small businesses generally pay between $40 and $50 each month, or $480 to $600 annually. The most common coverage for this rate is a $1 million per-occurrence limit, meaning the insurer will cover up to that amount in any individual claim, with a $2 million aggregate limit, meaning the insurer will cover up to that amount per year. While this is the most common policy\u2014over 90% of businesses covered by Insureon<\/a> chose this coverage\u2014around 5% opted for $2 million\/$4 million limits instead due to their business type.<\/p>\n\n\n\n<\/span>2. Find an expert you trust<\/strong><\/span><\/h3>\n\n\n\n
<\/span>3. Gather quotes<\/strong><\/span><\/h3>\n\n\n\n
<\/span>4. Evaluate and ask questions<\/strong><\/span><\/h3>\n\n\n\n
<\/span>5. Enroll and assess annually<\/strong><\/span><\/h3>\n\n\n\n
<\/span>General liability insurance requirements<\/strong><\/span><\/h2>\n\n\n\n
\n
<\/span>How much does small business liability insurance cost?<\/strong><\/span><\/h2>\n\n\n\n
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