Running a business comes with its share of risks. From customer injuries on your property to accidental damage at a job site, one unexpected event can result in legal fees, medical costs, or property repair expenses. Without the right insurance coverage, a single incident could jeopardize your financial future. That’s where general liability insurance comes in.
Whether you own a small startup or an established enterprise, general liability insurance is one of the most important types of coverage your business can have. Here’s why it’s essential—and how it helps protect what you’ve worked hard to build.
What Is General Liability Insurance?
General liability insurance protects your business from financial losses related to claims of bodily injury, property damage, and personal or advertising injury. This coverage is often the foundation of a business insurance package and can be required when signing commercial leases or business contracts.
In short, it helps cover legal defense costs and any settlements or judgments if your business is held responsible for certain accidents or injuries.
What Does General Liability Insurance Cover?
A standard general liability insurance policy can cover a wide range of incidents that businesses face every day. These typically include:
Bodily Injury
If a customer slips and falls in your store or office, general liability coverage can help pay for medical expenses and legal costs if you’re sued.
Property Damage
If you or an employee accidentally damage a client’s property while providing a service, your policy may cover the cost of repairs or replacement.
Personal and Advertising Injury
General liability also covers issues like libel, slander, or copyright infringement that can occur through marketing, social media posts, or advertising campaigns.
Legal Defense and Settlements
In the event of a lawsuit, general liability insurance can help cover attorney fees, court costs, and potential settlements or judgments.
Why Every Business Needs It
Accidents Happen—Even to the Most Careful Businesses
You don’t need to run a high-risk business to face a liability claim. Something as simple as a spilled drink, a loose floorboard, or a social media post can quickly turn into an expensive problem. General liability insurance gives you a safety net so you’re not paying out of pocket.
It Builds Trust With Clients and Partners
Having general liability coverage shows that your business is professional and prepared for the unexpected. Many clients and partners—especially in commercial or government contracts—require proof of insurance before doing business.
It May Be Required by Law or Lease Agreements
Some states or industries require liability insurance. Additionally, landlords often ask for a certificate of general liability insurance before leasing commercial property.
It Helps You Stay in Business After a Claim
Without insurance, the cost of defending even a minor lawsuit can be enough to close a business. General liability coverage helps ensure that one claim doesn’t wipe out years of hard work.
What General Liability Insurance Doesn’t Cover
While general liability insurance is broad, it doesn’t cover every risk. It typically excludes:
- Employee injuries (covered by workers’ compensation)
- Professional errors (covered by professional liability insurance)
- Damage to your own property (covered by commercial property insurance)
- Cyberattacks and data breaches (covered by cyber liability insurance)
To create a complete safety net, many businesses bundle general liability with other coverages in a business owner’s policy (BOP) or commercial package policy.
Who Needs General Liability Insurance?
Every business can benefit from general liability coverage, including:
- Retail stores
- Contractors and construction companies
- Consultants and freelancers
- Restaurants and cafes
- Service providers
- Manufacturers
Even if you run your business from home, you can still be liable for accidents or client disputes.
How Much Coverage Do You Need?
The amount of coverage your business needs depends on factors such as your industry, location, size, and the level of risk involved in your operations. Most small businesses start with $1 million in coverage, but your needs may vary. An insurance agent can help you determine the right limits based on your risk exposure.
Garrett Insurance Can Help You Choose the Best Insurance Policy for You
General liability insurance isn’t just a smart business move—it’s a critical safeguard against everyday risks that could otherwise derail your progress. Whether it’s a minor mishap or a costly legal claim, this coverage ensures you’re not left to face the financial burden alone.
At Garrett Insurance, we help small and mid-sized businesses find the right general liability coverage tailored to their operations. Contact us today to learn how we can help protect your business from unexpected liabilities and provide peace of mind for the road ahead.