Commercial insurance protects businesses from a host of possible scenarios. One of the biggest existential threats to a commercial enterprise is the possibility of a lawsuit. Liability insurance is critical, but you also need to carry the right policies for your business. Here are five common types of liability coverage.
This is the closest commercial insurance comes to the kind of coverage you might have on your home or car. Third-party liability covers injuries to folks who aren't party to your company's arrangements, unlike your employees or other businesses.
A grocery store, for example, allows members of the public to come and go during business hours. If one of those customers slips on a wet patch and sues because they fractured their spine, the store would have massive liability exposure. Consequently, the store's operator should talk with a commercial insurance agency about a policy guarding against such a scenario.
Errors and Omissions
Messing up even one little thing in a contract can also create major liability exposure. An errors and omissions policy covers your business against contractual liabilities. For example, a design firm might accidentally use a licensed color on a new logo. The business customer could then push this back to the design firm because it can't use the design.
Businesses that manufacture real products have to worry that users could suffer injuries. Likewise, they may demand compensation if the product breaks.
Product liability claims also have the risk of being massive if many users seek damages. In extreme cases, this could even lead to class action suits and cases that cross into other nations' jurisdictions.
Companies increasingly collect data about customers, and they have a duty to protect that information. Numerous laws at the federal and state levels protect consumer data. Also, individuals have the right to seek damages if a data breach causes them financial losses due to things like stolen identities and credit card numbers. Your commercial insurance should cover both types of liability risk.
A business also needs to protect its assets. This is particularly true if some of it would have a difficult time replacing those assets. A manufacturing business that requires one machine to stamp a key component, for example, needs coverage in case something happens to that system.
You may also need coverage for business interruptions due to events like natural disasters. This coverage doesn't just replace lost equipment. It covers lost profits.
For more information, contact a local company, like United Counties Insurance Group.Share