Small Business Liability Insurance Coverage

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What Does Small Business Liability Insurance Cover?

Small business liability insurance helps cover the costs of bodily injury and property damage claims up to the limits of your policy. This includes coverage for out-of-court settlements, litigation lawsuits, and injury damage. It also includes coverage for advertising errors in the event your business’s marketing violates a copyright.
 
Small business general liability insurance provides the same coverage as small business liability insurance. Although, your small business liability insurance coverage amount will depend on the size of your operation and the industry you’re in.
 

What Small Business Liability Insurance Does NOT Cover

As a small business owner, you should be aware of what your policy covers and doesn’t cover. For instance, while your small business liability insurance can help protect you from a variety of claims, it’s not a catch-all.
 
Your small business liability insurance will not help cover:
 
Employee injury. Workers' compensation insurance helps cover employees who sustain injuries on the job. For instance, say an employee breaks their ankle after falling off a ladder stocking shelves. Your small business liability insurance would not help cover the medical costs associated.
 
In another example, say two employees are carrying heavy boxes to your company’s basement. As a result, they both sustain severe back injuries. Workers compensation insurance can help cover their medical expenses and wages from lost work time. Your small business liability insurance would not help cover these costs.
 
Professional mistakes. Professional liability insurance can help cover an employee that makes a mistake in offering opinions, solutions, or services provided. For example, say an employee damages a client’s computer by installing the wrong part. Your small business liability insurance would not help cover the costs associated.
 
In another example, say you provide financial advice to a client that results in them having to close their business. Professional liability insurance can help cover the costs of lawsuits that result from the mistake.
 
Punitive damages resulting from a lawsuit. Small business liability insurance will not help cover damages that exceed your coverage limits. For instance, say a customer slips, falls, and breaks their arm at your business. Your small business liability insurance will not help cover costs that exceed your policy.
 
In another example, say a customer’s child gets injured while playing in the isles of your store. Your small business liability insurance will not help cover medical costs that exceed your policy.
 
Intentional acts. For instance, say an employee assaults a customer. Small business liability insurance would not help cover the damages if they sued you. However, say your employee was defending themselves or the business from a criminal act. Your small business liability insurance would help provide coverage.
 
It’s also important to note, that small business liability insurance doesn’t help cover property damage by the insured. Small business liability insurance is typically a part of a more extensive policy.
 

Does Your Company Need More Small Business Liability Coverage?

Small business liability insurance is usually part of a business owner’s policy (BOP). These policies include:
 
Property insurance. This coverage helps protect the building you own or lease. It also helps protect your other personal property. This can include tools or inventory. For instance, say a fire destroys essential computer equipment in your business. Property insurance can help cover the costs associated with replacing or repairing it.
 
In another example, say someone breaks into your business and steals your inventory. Your property insurance can help cover the costs associated with replacing it.
 
General liability insurance. This coverage helps protect your business from bodily injury and property damage claims. It can also help cover personal and advertising injury claims. For example, say that you own a painting business and accidently damage a customer’s valuables on the job. General liability insurance can help cover the costs associated with the damages.
 
In another example, say a customer gets injured while shopping at your business. Your general liability insurance can help cover the costs associated with their medical bills.
 
Income insurance. This coverage helps replace income lost due to a covered loss. For example, say your property is damaged by fire. Income insurance can help cover earnings that were lost during reconstruction of your building.
 
In another example, say someone breaks into your business and steals essential equipment. Income insurance can help cover earnings lost while you replace the necessary equipment.
 
Additional coverages that can be added include:
 
  • A 2-in-1 business owner's policy. Business owner’s policies combine business property and liability insurance into one policy.
  • Commercial auto insurance coverage. This coverage helps cover you and your employees if you’re found at fault in an auto accident. For example, say your employee accidently swerves and hits a fence while out on the job. Commercial auto insurance can help cover the costs associated with the damage.
After you’ve consulted your policy, reach out to The Hartford. We’ll help ensure that you have the right type of small business liability insurance coverage.
 
At The Hartford, we offer additional coverages for your small business that extend beyond what is listed above. For instance, you may want to include commercial umbrella insurance to extend your protection even more. You can also include workers compensation insurance if you’ve expanded and hired employees. Typically, additional coverages are based on what industry your business is in.
 
Keep in mind that insurance differs by state. This means calling a representative is essential for choosing the policy that’s right for your business. After all, having the right insurance is a key to success.
 
To learn more about small business liability insurance from The Hartford contact our representatives at 855-829-1683.
 
Certain coverages vary by state and may not be available to all businesses. All Hartford coverages and services described on this page may be offered by one or more of the property and casualty insurance company subsidiaries of The Hartford Financial Services Group, Inc. In TX, this insurance is written by Sentinel Insurance Company, Ltd., Hartford Casualty Insurance Company, Hartford Lloyd’s Insurance Company, Property and Casualty Insurance Company of Hartford, Hartford Underwriters Insurance Company, Twin City Fire Insurance Company, Hartford Accident and Indemnity Company and Hartford Fire Insurance Company. In CA by Sentinel Insurance Company, Ltd. (CA license # 8701) and its property and casualty insurance company affiliates, One Hartford Plaza, Hartford, CT 06155.
 
The Hartford® is The Hartford Financial Services Group, Inc. and its property and casualty subsidiaries, including issuing company, Hartford Fire Insurance Company. Its headquarters is in Hartford, CT.