A new business can be an exciting opportunity. It may be your dream to start one. Still, before you open your doors, you need to begin protecting that business. To do that, you need the right type of business insurance.
A key component of that policy is general liability insurance. It helps protect your company from claims made by others. It is one of the most important investments you will make in your company. When you work with a trusted agent, you do not have to worry about the complexities of this type of insurance.
What Does General Liability Insurance Cover?
This type of business insurance does not protect your company’s assets from loss. Rather, it protects other people. If someone were to fall on your property, they may have significant medical bills. Your company may be liable for those costs. Your liability insurance may help pay for this type of claim. The key here is to know what type of risks your business faces. You want to ensure you have enough liability insurance to avoid complications later.
What Risks Does Your Business Face?
To know how much general liability insurance you need, work with your agent. Specifically, discuss the type of business you operate. Assessing risk is one of the key steps that this process can offer to you. Here are a few considerations.
- Does your location have a lot of traffic flow? That is, are there many people walking by or coming in? This means more risk to those people.
- Does the company use machinery or equipment that could cause injury to someone else? If there is exposure to the public, this needs coverage.
- Do you manufacture or distribute a product? This, too, adds to liability risks.
- Does the company provide a service? What is the value and risks associated with that service? Could it fail?
- Does your business provide advice or guidance to others?
Most of the time, a general liability insurance policy starts at around $100,000 worth of coverage. Most businesses need $500,000 or more in coverage. As a new company, you may not need the largest policy. However, you still need the most secure coverage. If there is potential for a mistake to cause significant loss to someone else, you may need more coverage. Work with your insurance agent to ensure your coverage matches your current needs. You may need to change this over time.