Not So General: Commercial General Liability Exclusions
Commercial general liability (CGL) insurance protects your business from those who allege that they have suffered losses because of your business activities. It is one of the most common and valuable forms of commercial insurance coverage. Unfortunately, the term "general" isn't to be taken literally to mean that it includes all kinds of business liabilities. Just like other forms of insurance, CGL includes different exclusions, such as these four:
Don't expect CGL to come to your rescue if you have been sued for dumping toxic wastes in the local river. Pollution related claims are excluded from CGL, although some insurance companies provide limited coverage. If you need coverage against such claims, then you are better off purchasing a relevant endorsement. Note that the definition of "pollution" may vary by jurisdiction. Therefore, read your policy and get clarity on the included and excluded risks, especially those that your business is likely to incur; don't assume anything.
Damages or Injuries Arising from Automobile Use
Standard CGL doesn't typically apply if your aircraft, motorcycle or van damages another person's property or causes injury. There are separate policies, such as commercial auto insurance coverage, meant for such risks. However, you can opt to include auto liability coverage under CGL if you so wish; it isn't automatic.
Claims Arising from Workers' Claims
Your workers may have genuine claims against your business, but these claims won't be settled by your CGL carrier. These claims are typically paid by the worker's compensation insurance. CGL will not come to your rescue (for worker injuries) even if you don't have workers compensation insurance.
Alcohol Related Claims
Lastly, if your business deals (sells, brews or serves) in liquor, your CGL will not settle any claims that can be traced back to your liquor. For example, if you sell liquor in your restaurant, and a client is injured by another intoxicated client, CGL will not pay when the injury victim sues you under dram shop laws. Therefore, if your business is going to deal in liquor, talk to your insurance agent for clarification and buy the relevant coverage for your liquor activities.
As you can see, CGL isn't an all-encompassing form of insurance coverage that will protect your business from all kinds of injury lawsuits. It's a great place to start, yes, but you should then take the next step and buy the necessary endorsements or separate policies to ensure that you are fully covered. Talk to an insurance agent today to explore your options. For more information, contact a business such as Austin Insurance Agency.