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Commercial General Liability Insurance: How much is ENOUGH?

Most businesses have General Liability insurance, but do you really have a good grasp on just how much coverage is needed? In most cases, increasing your Liability limit or adding an additional Umbrella policy is a must.

Lawsuits Are a Reality

You have probably heard about million dollar lawsuits brought against major companies by people who were injured as a result of negligence. You may even have thought some of those lawsuits were superficial and unjustified, but the fact that you heard about them probably indicates that they went to court. And if they went to court, those companies were forced to defend against them, spending a lot of money on legal fees. Do you have enough coverage to handle those legal fees, and also pay out a settlement if your day in court goes against you? Many small businesses believe that they will not be the target of such a high dollar lawsuit because they aren’t big enough. This thinking is very dangerous; while some people may increase the dollar amount of their lawsuit when they know a company can pay, large lawsuits are still often brought against smaller companies. And smaller companies are the least able to absorb the loss if they are forced to fight a court battle and pay out on a settlement. This is why many companies really do need much more liability coverage than they may believe.

Carrying Enough Coverage

General liability insurance covers you for a wide variety of potential negligence situations, and it is actually one of the less expensive coverages for most companies. When it comes to determining how much you need, the simple rule is that more is always better. If the option is there to increase the coverage and it doesn’t make a large difference in your premium, you should consider taking it. The cost of a liability claim can rise quickly, and if your coverage limits are met you will be left to pay any remaining costs…yourself. If you have ever been involved in a lawsuit you know how expensive lawyers and court costs can be. Add to that the amount that a judge may award the claimant and you are looking at a serious financial loss. General liability insurance is the simple and affordable way to make sure that this doesn’t happen.

Call me to review your policy with you. Be certain that you are carrying enough, and if not, increase it if you can. When it comes to liability and your business, it is always better to be safe than sorry!