In this article I would like to go over the basics of a commercial general liability policy. Like workers compensation, this can also be a confusing coverage but I will do my best to simplify the concept. This type of policy covers certain exposures but not others and should be considered a very important part of your insurance puzzle.
What is General Liability?
General liability is a type of insurance coverage that provides protection for the insured in the event there is a loss to someone else’s property or bodily injury to someone other than an employee. It also provides coverage for personal and advertising injury to others along with coverage for medical payments. This policy does not cover losses related to employees, autos or pollution. These coverages require their own policy. A general liability policy is split into three parts. Part A covers bodily injury and property damage. Part B covers personal and advertising injury and Part C covers medical payments. General liability is written as an occurrence policy or a claims made policy and typically written on an annual basis.
What is Part A Bodily Injury and Property Damage?
Part A Bodily injury provides coverage for claims arising from bodily injury, sickness, or disease that occurs to a person. This includes death as a result of one of these injuries. Property damage is included and covers damage to tangible property and property that is not able to be used. The damaged property could also simply be inaccessible due to something that happened. This limit is normally one million dollars per claim with a two million dollar limit for the policy period.
What is Part B Personal and Advertising Injury?
The second part of this policy provides coverage for a claim arising out of personal injury which includes false imprisonment, detention, malicious prosecution, wrongful eviction or entry and slander and libel in either written or oral form. Advertising injury coverage includes the use of using another’s ideas as your own, infringement of someone’s copyright or trade slogan in your advertising. It will provide coverage for claims that include information both printed on and on the internet. This coverage does not apply to companies in the business of advertising. The limits are normally the same as those in Part A.
What is Part C Medical Coverage?
The final part of this policy covers medical payments to those injured regardless of fault. It is often referred to as goodwill insurance. It will pay for accidents to an individual that occurs on the insured’s premises. The injured party cannot be an employee, tenant of the building or someone injured due to sport activities. The limit on this part of the policy is generally between five and ten thousand.
The general liability policy will have numerous exclusions for claims that are covered under other policies. There can be deductibles and special coverages may be added to this policy through the help of your agent and the underwriter. Make sure your company’s exposures are properly addressed. The rating basis for this coverage can be sales, payroll, square footage or some other measure. This policy may also be audited after it expires. Be sure to know what your policy rating basis is and review it during the policy period.
We can help you put all the pieces into place. Give us a call at 626.568.9933. Ask for Geoff.