기타특종보험 : Commercial General Liability
기타특종보험 : Commercial General Liability 안내입니다.
Commercial General Liability Insurance, CGL
In today’s litigious society, even small mishaps can result in large lawsuits. That’s why general liability insurance, along with property and worker’s compensation insurance, is essential for most companies. Liability insurance protects the assets of a business when it is sued for something it did (or didn’t do) to cause an injury or property damage.
How General Liability Works
Under a general liability insurance policy, the insurer is obligated to pay the legal costs of a business in a covered liability claim or lawsuit. Covered liability claims include bodily injury, property damage, personal injury, and advertising injury (damage from slander or false advertising). The insurance company also covers compensatory and general damages. Punitive damages aren’t covered under general liability insurance policies because they’re considered to be punishment for intentional acts.
General liability insurance policies always state a maximum amount that the insurer will pay during the policy period. Usually these policies also list the maximum amount the insurer will pay per occurrence. For example, if a company has a $1 million occurrence cap in its liability policy and it’s successfully sued for $1.5 million, the insurer would pay $1 million and the business would be responsible for paying $500,000.
To cover these types of situations, many companies purchase umbrella liability insurance, which picks up where their general liability coverage ends. Umbrella liability covers payments that exceed their other policy’s limits, and provides additional coverage for liabilities not covered in a standard liability insurance policy.
What’s covered
There are four main types of coverage included in the standard Commercial General Liability (CGL) policy: Bodily Injury and Property Damage Liability, Personal Injury Liability, Medical Payments, and Tenants’ Legal Liability (for those that rent or lease their workspace.) We’ll pick these off one-by-one with what will hopefully be an easy-to-understand explanation.
A. Bodily Injury and Property Damage Liability
Basically, if your company, your product, your work, your employees, or anything else associated with your company causes physical injury to someone like a client, or damages their property or belongings, you could be held legally responsible. If held legally responsible you may be required to pay. It is in cases like these that your coverage will pay for the compensatory damages. Plainly put, compensatory damages are damages meant to compensate. Its purpose is to put things back the way they were (financially) prior to the injury or damage.
B. Personal Injury Liability
The phrase ‘personal injury’ is confusing because in the insurance world it means one thing, and everywhere else it often means something all-together different. While most people associate ‘personal injury’ with physical injury this is not the case with a CGL policy where it actually means damage (so to speak) of a person’s character, reputation and position in the community as a result of libel (in print) or slander (verbal defamation.) Remember, a liability policy is to protect you if you’re accused of libel or slander, not the other way around.
C. Medical Payments
This part of your CGL policy is interesting, as its purpose is to provide coverage that pays someone’s minor medical expenses from an accident that happens at your company’s premises or as a result of your company’s operations?even though you may never be held legally liable for the accident. In fact, it’s often used as a way to avoid a costly lawsuit.
D. Tenants’ Legal Liability (for those who rent or lease their workspace)
Suppose you don’t own the space where you’ve set up shop and rent your office, shop or retail space. If you are held legally responsible for causing a fire, explosion, smoke damage, or other damage caused by fire protection (like sprinklers going off) then this coverage will pay the compensatory damages (remember, the intent of compensatory damages is to put things back the way they were.) This applies only to damages of the rented premises ? not the property (i.e. product, inventory etc.) that you may personally own.
With general liability coverage, your business is protected if you are found legally liable for injuries or property damage caused by your product or accidents on your premises or at your customer’s location. It’s not expensive ? especially when compared to the cost to defend a claim against your business in the courts.
