What is required for commercial liability coverage? What is optional?

Is a small service company less likely to have a lawsuit brought against it than a manufacturing plant? No, but this is a common misconception among office-based businesses. The fact is, in today’s dynamic and complex business climate, businesses small and large, office-based, or physical-labor intensive, are all equally susceptible to various claims.

Typically, with Commercial Liability insurance coverage, four types of claims are covered: bodily injury; property damage or loss; personal injury, such as libel or slander; and advertising injury. While commercial liability insurance is fairly inexpensive, costs for defending a claim are not and if the company does not have adequate commercial liability insurance coverage, it may have to foot the bill. This, in turn, could lead to financial hardship or bankruptcy. Commercial Liability insurance coverage will pay for all damages, legal fees and settlement charges up to the policy limits.

Commercial Liability insurance for office-based businesses is absolutely essential for financial planners, mortgage brokers, medical offices, architects, and engineers, to name a few. Too often, however, a business owner will forego liability insurance in an effort to reduce operating costs. This may save the company some money on paying premiums, but it also exposes the business’s assets to paying for damages, if found liable, as well as legal defense expenses, regardless of whether the business is found liable or not.

Small business owners can take several proactive steps towards reducing their insurance costs, including:

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James Cochran is the founder of Business Insurance Now, a company specializing in commercial liability insurance. Business Insurance Now also offers professional liability insurance for those in the consulting industry and workers comp insurance to cover your company’s employees.

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