By protecting yourself with liability insurance you can make sure that you’re covered against a range of eventualities that could go wrong in your business and threaten your livelihood
Liability insurance is a very broad superset that covers legal claims against the insured. In many countries, liability insurance is a compulsory form of insurance for those at risk of being sued by third parties for negligence. Liability insurance policies cover both legal costs and any legal payouts for which the insured would be responsible if found legally liable. Intentional damage and contractual liabilities are typically not covered in these types of policies
Liability insurance requires you to select limits. These limits determine the maximum amount your insurance company will pay if you need to use the insurance coverage. Limits are described either as split limits or as a combined single limit.
Liability insurance is very important for those who may be held legally liable for the injuries of others, especially medical practitioners and business owners. A product manufacturer may purchase product liability insurance to cover them if a product is faulty and causes damage to the purchasers or any other third party. Business owners may purchase liability insurance that covers them if an employee is injured during business operations. The overall purpose of liability insurance is to spread the risk of economic loss among members of a group who have common shared risk. Individually, the primary objective is to protect your assets in the event of a judgment or settlement in favor of the claimant. Liability Insurance gives peace of mind.
Liability insurance covers the risk of claim because of
• Damage to others’ property
• Bodily injury caused to anyone (other than employees) because of business operation
• Personal injury including libel and slander
• Advertisement that misleads audience and is false
Whether you are a home or business owner, one important type of liability insurance is an umbrella insurance policy. Providing an additional layer of liability coverage on top of your existing policy’s liability limits, this type of coverage proves invaluable in the event of an accident or other situation that evolves into a lawsuit.
Liability insurance is not only important for home and business owners, but also it proves crucial in protecting people considered to provide professional services, like medical professionals. While all providers of professional services should protect themselves with professional liability insurance, physicians tend to face especially high risks.
Before purchasing any insurance policy you must determine what protection a professional liability policy provides. It is wise to obtain a sample policy and discuss any question with the insurance agent. When the policy is issued, the professional should read the entire policy to be sure that it provides the coverage discussed with the agent. It’s a good idea to find out as much as you can about liability insurance and the requirements of the sector you work in before taking out a policy, as various levels of cover can be required depending on the type of work you carry out.