Three Things General Liability Insurance May Not Cover

Three Things General Liability Insurance May Not Cover

general liability policies

When you own a business, you may rely on commercial general liability insurance to cover your responsibility for risk. There can be limitations to what general liability policies can cover. Here are three things a general liability policy may not cover.

Injury to Employees

Most general liability policies can cover bodily injury to customers or other third parties, but they may exclude employees of the business. Businesses seeking coverage for injuries to employees may have to obtain a separate workers compensation insurance policy.

Liability Associated with Consumption of Alcoholic Beverages

Businesses that serve alcoholic beverages may have a higher risk of property damage and bodily injury. General liability policies may not cover the responsibility for these damages. Therefore, business owners who sell or provide alcohol in their establishments may need a special liquor liability policy to cover their risks.

Liability Assumed in a Contract

A general liability policy can cover property damage and bodily injury to a third party if the business has not entered into a contractual agreement assuming responsibility for damages to that party. If your business typically contracts with third parties, you may need to carefully review the liability section of the contract to safeguard against signing away your right to protection under your insurance policy.

When purchasing insurance, it may be important to know the types of risks your business can be exposed to and the limitations of coverage of your insurance policy. This can prevent unfortunate surprises from being denied coverage for something that you thought your insurance would cover.