Commercial General Liability Insurance
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When you build your business from the ground up, it’s a process that takes hard work, sweat, and tears. A business without insurance is left exposed to liability claims that could occur in any part of its operations. This could mean losing money or your reputation.
Over 1/5 of small businesses in Canada fail in their first year. This could be for any reason – poor planning, inadequate business practices, or insufficient risk management. Insurance can bolster your business’s odds of success. As a small business owner, you want to protect your operations.
When it comes to business liability insurance, there are many Commercial general liability Insurance coverage options to choose from. Commercial general liability (CGL) insurance is just one of many options. EasyCover offers one of Canada’s only online portals through which you can purchase insurance directly. Get a free commercial general liability insurance quote with us today.
What is Commercial General Liability Insurance?
Commercial General Liability Insurance (CGL) coverage is critical for your business as it protects it against claims brought by third parties for bodily injury (including death) or property damage due to your business’ operations. This includes the actions or inactions of you and your employees while performing your business duties. These situations can occur on your business premises, on public property or at a client’s premises.
Who Needs Commercial General Liability Insurance?
In the world of business, where unforeseen mishaps and unexpected circumstances can lurk around every corner, having Commercial General Liability (CGL) insurance is a smart move. CGL is not limited to specific businesses or industries – it’s a necessity for anyone who wants to protect themselves from potential lawsuits and financial lawsuits. You may need business liability insurance if you:
- You conduct business on behalf of your clients.
- You are frequently in personal contact with customers.
- Your business property is owned or leased.
How Does General Liability Insurance Work in Canada?
Maybe you’re starting a new business or looking to expand your current operations. Regardless of your business plans, understanding how general liability insurance works is key to protecting your business.
We understand how business liability insurance can be tricky, but our EasyCover insurance brokers in Canada can break it down for you and answer your questions.
Different Types of CGL Insurance in Canada
It’s important for a business to distinguish between a claims-made insurance policy and an occurrence policy when purchasing commercial general liability insurance.
A claims-made policy is an insurance policy that covers claims made any time after your policy’s retroactive date and while the policy is in force. An occurrence policy covers claims that occurred during your policy timeframe, and can even be submitted after the policy has expired.
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What Does Commercial General Liability Insurance Cover?
A commercial general liability insurance policy in Canada includes the following coverage options:
Bodily Injury
CGL policies can protect your business from liability if you are found responsible for injuries to a third party, including bodily injury and property damage. If a customer trips and falls on a loose carpet, for example, your business could be sued for bodily injury. Third-party bodily injury and property damage claims can be raised by customers, vendors, employees, delivery and maintenance personnel, and anyone who physically visits your place of business. Claims can lead to your business paying out for medical bills, lost wages, and more.
Property Damage
If your business causes damage to a third-party’s property I.e., client’s home, office or at your business premises, this type of CGL coverage will cover lawyer fees and other expenses if you’re sued.
Product Liability
Product liability covers you for any injuries or property damage caused by a product you sell or service you provide. This type of CGL coverage will protect you when a customer claims that your product or service caused them harm or damage, such as if a faulty lawnmower you sold injures someone or if a landscaping service you provided damages a client’s property.
Personal and Advertising Injury Liability
Personal and advertising liability protects you from financial loss from non-physical personal injury and covers third-party lawsuits. This type of CGL coverage will protect you when someone accuses you of slander, libel, false arrest, malicious prosecution, wrongful eviction, violation of privacy rights, copyright infringement, or other forms of non-physical harm or damage to their reputation or business.
Tenant’s Legal Liability
Tenant insurance, also called tenant’s legal liability, covers you from the risk of operating on leased premises. Your CGL insurance can cover you for damage to rental spaces caused by you or your employees. Before you rent out space for your business, many landlords will require that you purchase this coverage. This type of CGL coverage will protect you when you accidentally damage the rented premises, such as causing a fire or water damage, or if someone gets injured while on the rented property due to your negligence.
What is Not Covered by Commercial General Liability Insurance?
CGL insurance does not provide coverage for lawsuits stemming from intentional criminal acts, patent infringement, or contractual liability. To safeguard yourself from claims related to professional advice and services, you will require a separate professional liability insurance policy, in addition to your commercial liability insurance.
How Much Commercial General Liability Insurance Coverage Do I Need?
To determine how much commercial general liability coverage your business needs and if you need additional business liability coverage, there are a few factors to take into consideration:
- The size of your company
- The industry you work in
- The frequency you interact with vendors
The factors above will help you determine your risk exposure. Depending on your profession, additional coverage may be required. For example, a contractor fixing something in a person’s home has a higher risk of causing property damage than a web designer who works from home.
Talk to one of our commercial general liability insurance brokers about tailoring your policy to your business needs.
How Much Does Commercial General Liability Insurance Cost?
A basic commercial general liability insurance policy with a $2M limit will cost approximately $450 per year for a small business – or medium-sized company but the rates vary based on various factors.
Below are some key factors that are considered when determining your CGL insurance rate:
- Years of experience.
- Industry you work in.
- Annual and projected gross revenue.
- Number of employees.
- Previous insurance claims.
Contact one of our commercial liability brokers today for a free commercial general liability insurance quote.
What Other Insurance Coverage Does My Business Need?
Commercial General Liability Insurance is not a catch-all insurance policy. You may need other forms of coverage to fully insure your business. Here are some examples of what you could need:
Data breach/cyber risk coverage
Businesses are constantly at risk from cyber-attacks, which have increased in recent years. A business can get coverage to help them reduce some of the costs associated with computer hacks, data breaches and other cyber risks. This coverage, also known as cyber liability insurance, often comes in many forms.
Professional Liability
If a client or customer claims that your advice has caused them to lose money, professional liability can help you to recover from a claim. This liability coverage is also known as the errors and omissions coverage (E&O).
Equipment breakdown insurance
You are already covered under property insurance for some external damage such as fires, floods, and storms. However, your general liability policy may not cover you if there is electrical damage, or your equipment fails. Equipment breakdown will help you financially when you need to repair or replace your equipment or machinery.
Commercial auto insurance
If you or your employees use vehicles for business purposes, you require commercial auto insurance. If you own five or more vehicles, you will require a fleet insurance.
Directors and Officers Liability Insurance
If your company has a board of directors, or if you are one of the directors, D&O insurance can help protect you from personal financial liability in case of lawsuits related to decisions made by the board.
Employment Practices liability insurance
If an employee sues over issues such as wrongful termination, harassment, or discrimination, this type of coverage can protect you from legal expenses and also cover damages.
Medical expenses
Commercial general liability insurance can also cover medical expenses for injuries that occur on your business premises, regardless of who is at fault. This liability coverage may help prevent a small injury from turning into a larger lawsuit.
EasyCover Insurance provides expert advice about what would be the proper CGL insurance coverage for your business. Give us a call or chat with us online for speedy service and a free business liability insurance quote.
4 Ways to Avoid a Commercial General Liability Insurance Claim
Preventative measures in your business can help you avoid time and money spent on claims details and lawyer visits. Below we cover ways to avoid having a claim submitted against you.
- Maintain Safety Standards – While you can’t always prevent accidents, there are ways to reduce injuries and property damage from happening in your business. Adhering to safety regulations in your industry helps reduce the likelihood of accidents. Use the correct equipment for your job and ensure that the environment is safe.
- Train Employees – Make sure your employees are familiar with your organization’s business standards. This includes how they present your business online. To reduce the risk of general liability, equip your staff with risk management training. Also you may need to check event liability insurance.
- Content Usage – It’s important that business owners are careful about what they say and post about their clients or competitors. Negative remarks about others, online or in person, could lead to getting sued for slander and libel. Copyright infringement is also worthy of a lawsuit, so make sure you’re not using another person’s content without their consent.
- Proper Handling of Customer’s Equipment – It’s important to be responsible when handling your customer’s property. If you are repairing computers, for example, it’s always a good idea to document the condition of the computer before you start the work to minimize any unnecessary claims.
Useful Resources:
CGL Locations
FAQs: Commercial Liability Insurance
While Commercial insurance is not a legal requirement to operate most businesses, commercial general liability insurance is highly recommended to protect you and your business from the unexpected. One insurance claim could result in a huge financial burden that could shut down your business. Find a solid insurance policy by contacting us today.
There are several key differences between a CGL policy and a professional liability policy.
A CGL policy will protect your business from claims submitted for bodily injury or property damage, while professional liability insurance protects you financially against claims for errors and omissions from providing advice and other professional services to clients.
This insurance covers personal injury claims if your client falls on your equipment, for example. If you are a personal trainer and one of your clients sustains injuries while exercising under your guidance and sues you, you will need to pay legal fees. A professional liability insurance policy gives you this protection. Check out our blog on determining if your business needs professional liability insurance.
It depends on your business and the information you provide to your insurance broker or insurer. For a quick quote from EasyCover, contact us today and we’ll help you get started with a secure business liability insurance policy quote.
A commercial general liability occurrence is an event that results in bodily injury or property damage during the policy period. This can include accidents, negligence, and other incidents that lead to a claim against your business.
A commercial general liability insurance policy covers a wide range of claims, including bodily injury, property damage, personal injury and advertising injury. This can include things like slip and fall accidents at your business premises, damage to someone’s property caused by your staff or operations, and lawsuits for defamation or copyright infringement.
While commercial general liability insurance provides broad coverage, certain exclusions are important to know about. Common exclusions include professional errors or omissions, intentional acts, and pollution liability. It’s important to carefully review your policy with an insurance broker to understand what is and isn’t covered in your specific policy. Additionally, you may need to purchase additional coverage or specialized policies for certain risks not covered by commercial insurance.
There are several ways to reduce your CGL insurance rate, including increasing your deductible and adjusting your policy limits. EasyCover brokers can help you navigate this process because we have access to multiple insurance markets that provide CGL coverage. Connect with us today!
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