Unexpected situations can arise every day when you are a contractor or business owner. So, you require a shield that can protect you from such surprises and helps your business float by without a dent in its finances. Unfortunately, any day, any lawsuit can turn into a fight to keep your business afloat due to a financial crunch. This situation is where you require the help of general liability insurance.
What Loss Exposures Does Liability Insurance Protect You Against?
Loss exposure refers to any circumstances, activity, events, and properties that can lead to a loss. This general liabilityexposure segregates into four different groups. The four categories are:-
- The insurance cover defines any liability that arises due to the business operations and the business premises. These operations can happen either on or off-sites.
- Complete products and operations is another category of liabilities that provides coverage for the finished products. It is complicated insurance to define as it covers all the present and past works.
- The third category is a contractual liability. It is a customized version of insurance as it covers something that is not present under general law.
- The final liability is independent contractor liability. This kind of liability is handy to small businesses as they hire independent contractors for their jobs. It defines a company or a person that recruits a self-governing contractor to do work on their part.
What Doesn’t General Liability Insurance Cover?
Understanding what insurance coverage provides is one thing but, it is equally important to understand the aspect of business that the policy does not cover. Every insurance policy has certain limitations and exclusions that it does not cover. Such exclusions happen because either these coverage are desirable to only some businesses, or the loss risk is not insurable. Some property damage or bodily injuries exclusions are:-
- Aircraft, Watercraft, or Auto
- Distribution of Stock in Breach of Statutes
- Intended or Expected Injury
- Liquor Liability
- Mobile Equipment
- Workers Compensation
Buying insurance is compulsory as many clients demand that the businesses they contact have liability insurance coverage. Research well about every aspect of the insurance before buying one.