General liability insurance is often necessary for a small company. This type of insurance coverage assists in protecting the owners and the business assets. A liability insurance policy covers business liabilities that may otherwise be directed at the company owners and employees. General liability insurance says that the company is protected against any third party liability that may occur due to certain covered applications of the insurance policy. These applications may include company issues with negligence or certain product liabilities. Deliberate acts of moral turpitude are usually not covered by any insurance policy.
LEVELS OF COVERAGE
There are certain levels of coverage that are available for most general liability insurance policies. These levels of coverage may include a one million dollar policy coverage, or the coverage may be a greater sum of coverage. The level of coverage necessary may be a factor of several issues:
1. Professionals in the medical industry may be required to have a larger level of coverage because of the nature of the work performed. Medical professions are often working with the general public at large and are performing critical care services.
2. Other professionals are required to have larger sums of coverage for similar reasons that apply to their respective fields. Attorneys are performing services for the general public and have critical duties to administer.
3. Financial services professionals are managing large sums of funds and may need a sizable insurance policy to cover the amount of a portfolio.
LOCAL LEGAL SYSTEM
Deciding which level of coverage may need to take into account the local jurisdiction for the company location. If the local jurisdiction has a history of awarding large cash settlements for certain types of complaints, then the company may want to increase their insurance policy limits as a protective measure. Speaking of an interesting legal system, if you are in the construction industry you really need to look into contractors insurance to protect yourself and your assets!
Umbrella insurance is an option for a growing business. A basic liability insurance policy may be adequate for a start up company. As the business grows, the company may want to add on an umbrella policy for the additional business growth. An umbrella policy is relatively inexpensive. This may be an option for a company that is located within a litigious jurisdiction.
BUYING GENERAL LIABILITY INSURANCE
Buying general liability insurance can mean the difference between an adequate settlement pay out for a complaint against the company and a large judgment that is not affordable for the company. A business is always exposed to a type of lawsuit risk. Third parties may claim that they have suffered a loss. Having the means to address such a matter is frequently a necessity for a company. Some contracting businesses may require a certain amount of coverage in order to avoid any unpaid complaints.
General liability insurance is frequently a critical part of any new business. Often there may be claims of loss from customers or third parties. Having the means to address such matters may be a necessity for a start up company. Other options are to pursue the matter privately with a hired attorney.