Commercial General Liability (CGL) insurance is a type of insurance coverage that
provides financial protection to businesses and organizations against a wide range
of liability risks. It helps cover costs associated with legal claims and lawsuits
brought by third parties (such as customers, clients, or the public) for bodily
injury, property damage, or personal injury that occurs as a result of the business's
operations, products, or premises.
Key points about Commercial General Liability Insurance:
Coverage: CGL insurance covers various liability exposures, including:
Bodily Injury: Physical harm or injury suffered by someone else
due to your business activities or products.
Property Damage: Damage to someone else's property caused by
your business operations or products.
Personal and Advertising Injury: Claims related to defamation, libel,
slander, copyright infringement, and false advertising.
Legal Defense: CGL insurance helps cover legal defense costs, including attorney fees,
court expenses, and settlements or judgments, if your business is sued for covered claims.
Limits and Deductibles: Policies have coverage limits, which represent the maximum
amount the insurance company will pay for a claim. Deductibles are the amount
you need to pay before the insurance coverage kicks in.
Occurrence vs. Claims-Made Policies:
CGL policies can be structured as either "occurrence" or "claims-made" policies.
Occurrence policies cover claims that arise from incidents that occurred during
the policy period, regardless of when the claim is filed. Claims-made policies
cover claims that are made and reported during the policy period.
Exclusions: CGL policies may have exclusions that outline certain situations
or risks that are not covered. It's important to review these exclusions to
understand the limitations of coverage.
Additional Coverages: Some CGL policies offer endorsements or additional
coverages that can be added to the base policy to provide specialized protection,
such as coverage for employees' actions, data breaches, or liquor liability.
Risk Management: CGL insurance is a fundamental component of a business's risk
management strategy. It helps protect against unexpected financial losses that could
result from legal claims.
Different industries and businesses may have unique liability risks. As a result,
CGL policies can be tailored to the specific needs and risks of different types of businesses.
Commercial General Liability Insurance is essential for businesses of all sizes and
industries. It provides peace of mind knowing that if a customer, client, or member of
the public sues your business for alleged harm or damage, you have insurance coverage to
help address the potential financial impact of such claims. Businesses should work with
insurance professionals to ensure they have appropriate coverage levels and understand the
terms of their policy.