Every business operates in a volatile environment. It does not matter how large or small your enterprise is; risks are always present. These business risks take various forms like lawsuit filed by customers or employees as well as the risk of competition. Since no business is free of uncertainties, opting for an insurance cover is essential. Liability insurance is one such policy that helps to protect against these unpredictable business risks.
So what is liability insurance?
A liability insurance
plan protects from the claims that are filed by the various stakeholders against the business entity. Liability insurance coverage includes the legal costs as well as any compensation that is payable by the business entity. This amount is subject to the sum assured in your insurance policy. One must note that any intentional damages or contractual liabilities are not covered under liability insurance.
How does a liability insurance coverage spread?
Liability insurance policies can be opted by anyone who can be held liable by any third person. It is not only in case of a business organisation but also for professionals. So any person who can be sued for the damages or any injury must opt for a liability cover.
A manufacturing unit may opt for product liability insurance to insure against the liabilities from their products to customers and other stakeholders. Also, a public liability cover protects against the obligations arising from claims made by any third person against the company.
Let us look at liability insurance coverage on offer:
Commercial general liability cover
Buying a commercial general liability insurance
plan protects the business against claims from any injury to person or damage to property at the premises of the insured. It also covers the operations of the entity along providing a liability cover for its products. Further, any losses caused due to advertising and personal injury are included in your commercial general liability insurance.
Directors and Officers liability cover
Any liability that arises on the organisation's key persons is covered under this insurance. The directors and the officers charged with responsibility are the face of the organisation, and any claim filed against such persons can be insured using a directors and officers liability insurance cover. Generally, complaints are filed by the employees, the suppliers, competitors, regulators, customers and other stakeholders in the supply chain.
Professional indemnity insurance
Any person or organisation providing services to their clients can be sued for professional misconduct. At such times, an indemnity insurance coverage offering protection against such acts of negligence can be insured by professional liability insurance. It is recommended for professionals on whose advice the clients take actions.
Employer Liability Insurance
The liabilities that an organisation may be required to bear for any injury or harm to the employees during their employment is covered by employer liability insurance. There are legal regulations about maintaining an insurance cover to honour such liabilities.
Clinical Trials Insurance
Clinical trials are crucial in discovering new and innovative products. Most commonly used in pharmaceutical companies, it is also needed in the food, cosmetic and healthcare sector to safeguard from liabilities filed by the participants.
Trade credit insurance
A type of liability insurance where the insured can get coverage for their accounts receivable.
So make sure you avail a requisite type of commercial insurance
coverage to safeguard against the various business risks that are inherent to the business environment.