Liability is a must for businesses of all sizes. It is important to have a plan in place prior to the start of business on your first day in operation. Accidents can occur at any time and being covered for those instances is a must. Not having proper insurance coverage can leave the company with a financial hardship.
Bodily Injury Claims
If a vendor or customer is hurt on the business’ property, liability insurance would cover their bodily injury claim. It would also help cover any settlement amount if the claim required court proceedings. In some cases, the injury may be minor and may only require the company to cover the cost of an emergency room visit.
Defective Product Injury Claims
If a product injures a customer, liability insurance would help cover their injuries, the cost of purchase and any other fees associated with their claim. The company should immediately issue a recall of all of the products of the same type to properly inspect them for defects and safety.
Customers can be offered a replacement plus a refund, and this will satisfy most of them. Customers that received injuries from the product, may require medical bill payment and other fees to be paid.
Advertising can cause injury to an individual, religious entity or any other organization that feels offended. It is important to choose advertising methods wisely and ensure that they are not defaming, offensive or politically incorrect in a way that would affect society negatively. In most cases, instances of advertising injuries (whether it is from offending others, copyright infringement or slander), can be settled outside of court and directly through the liability insurance company.
Any time that your business offers delivery service or must transport goods to an alternate location, property damage can occur. There are dozens of scenarios that can occur while employees are on the road completing work-related tasks. Auto accidents can occur along with striking pedestrians, toppling signs or hitting buildings. All of these instances would be covered under company liability insurance, unless there is an underlying circumstance that would deny coverage.
Any time that a customer or vendor claim negligence, a business can be held financially responsible. Negligence can be things such as allowing customers in an unsafe area that caused injury, using improper language toward customers, not maintaining a building, faulty electrical wiring causing shocks or electrocution, among other things. All of these accidents can have serious consequences from sustained injuries. Some can lead to further legal difficulties for a business. Negligence insurance is one of the most important coverage types for a business to have.
Liability insurance helps a business when injuries and other unforeseen events occur. If a small business was required to pay out of pocket for any of these scenarios, it could put them into bankruptcy proceedings. The expense of liability insurance is beyond worth it and should be worked into the business’ annual budget spending plan to ensure that coverage does not lapse.