What Are The Different Types Of Business Liability Insurance?
Any kind of stress, physical injury or monetary loss cause to a person due to the negligence of another person is termed as liability.
Whether you are the proprietor of a small company or the owner of a big multinational company, your business is at a great risk and anyone can sue you at any point of time. You can be held accountable for some kind of negligence in your operations or injury caused to a third party in your business premises. Therefore, you need to safeguard and protect your business from any kind of liabilities by taking business liability insurance.
It is therefore, advisable to opt for business liability insurance, as it pays for your legal expenses (in case someone files a case against you or your products and services), thereby saving a lot of expenditure towards compensation costs to the third party claiming physical damage or financial loss caused due to you or your business. It also covers all the medical expenses of third party (it even reimburses the loss of pay of the individual, pays his pharmacy bills, doctor?s fee, hospital admission charges, etc) who may have been afflicted with a physical injury or mental stress caused by your negligence. The business liability insurance does not, however, cover such cases, where a person is harmed or hurt intentionally and you are liable to face the consequences.
There are 3 types of business liability insurance, that are means for different kind of business risks and these 3 types of business liability insurance are explained below ?
The first type of business liability insurance is called as general liability insurance or as commercial general liability. It is the most commonly adopted form of protection from unexpected business liabilities such as property damage claims, advertising claims or claims of injury that may have been caused to your clients or customers due to your negligence on your own company?s premises. General liability insurance also covers the damage or injury caused to your employees or the company?s agents while they are on official duty, irrespective of whether they are working within the office premises or performing an official task outside the office.
The second type of business liability insurance is called as professional liability insurance, which is also, knows by the name of ?errors and omissions? coverage. It is compulsory for professionals (such as surgeons, doctors, dentists, plastic surgeons, or bankers and financial advisors) to obtain professional liability insurance to protect their business and themselves from third party liability claims, such as mental stress, physical injury or financial loss incurred due to the oversight, negligence, technical mistakes, or malpractice by these professionals.
The third type of business liability insurance is called the product liability insurance. This kind of insurance is meant for those businesses which repair, sell, or manufacture any products. The coverage costs pay for those claims which are made by people who have either been injured after using your products or whose property has suffered extensive damage after the use of your products. The coverage costs can vary from case to case, depending on the risk potential of your product and also depending on the degree of damage or injury afflicted to the person who has filed the claim.
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