Commercial General Liability coverage protects your business from damages caused by bodily injury or property damage in which your business is found to be legally liable.
Coverage A: Bodily Injury and Property Damage Liability:
Bodily Injury or other Physical Injury: Includes not only bodily injury but sickness or disease sustained by a person, including death resulting from any of these at any time. This could also include mental injuries or emotional distress.
Property Damage: Physical injury to tangible property including resulting loss of use and loss of use of tangible property that has not been physically injured. Tangible property is property that can be touched or felt.
Products/Completed Operations Liability: Protection against claims arising out of your products or completed work. There must be bodily injury or property damage coverage and there must be a direct connection between the defective work or product and the injury or damage. Finally, the bodily injury or property damage must take place away from the premise owned or rented by the insured. It must occur when the product is no longer in the insured’s physical possession and be after work has been completed.
There are three exclusions that should be noted:
- If the product is faulty, there is no coverage to remake or redo it.
- If the work is faulty and therefore there is property damage to the insured’s work, there is no coverage for the completed work. (Ex: A contractor builds a stairway. It collapsed. There is no coverage for the stairway).
- Damage to Impaired Property: Excludes damage to property that is defective or unstable because it contains the insureds defective product or defective work.
Coverage B: Personal and Advertising Injury:
Protects an insured against liability arising out of certain offenses such as:
- False Arrest.
- Infringing on another’s copyright.
- Malicious Persecution.
- Use of another’s advertising idea.
- Wrongful eviction, entry or invasion of privacy.
Coverage C: Medical Payments:
Provides payments for injuries sustained by a non-employee caused by an accident on the insured’s premises or when exposed to the insured’s business operations. The insured does not need to be at fault to pay out under medical payments coverage. This coverage pays for medical, surgical, ambulance, hospital, professional nursing, and funeral services for a person injured or killed.
General Liability coverage can be purchased as a policy by itself or can be packaged with other lines of coverage such as Property, Crime, Inland Marine coverage, etc.
Be sure to read the policy carefully to understand all coverages, limitations, and exclusions.