Do you know the value of net premiums written by product liability insurance alone in 2020 amounted to 3.24 billion dollars in the US? These statistics from Statista highlight how common it is to land into a liability claim situation. And when you do land, you should be aware of the claim procedure so that your chances of receiving the claim amount increase. So, here is how to make a general liability insurance claim!
But before we start, let us first skim through general liability insurance basics and see which situations we can put up the claim!
What is General Liability Insurance?
General liability insurance aims to secure businesses from clients, customers, and other third-party claims. It offers coverage for,
- Property damage: Say you are an event manager, and you damage your client’s floor while decorating it. Now, your client can sue you, but General liability insurance protects you from such instances.
- Advertising injury: If you talk or write false about your client or competitors, you can be sued. But with this policy, you are protected.
- Product Liability: You have a paints shop. But the paint your client bought started peeling off very soon. Now, he may sue you for damages and loss. But general liability policy to the rescue.
- Bodily injury: A customer visits your gift store. While moving inside the store, he slips on the wet floor and hurts his back. The customer asks you to pay for his medical costs. In this case, the general liability policy saves you from paying the medical expenses and any lawsuits if they occur.
This is also popular as business liability insurance, and you can customize it as per your business needs.
When do you need to make a General liability insurance claim?
People make General liability insurance claims more often than you think! It is pretty easy to land yourself in such difficult situations.
And the precise situation when you need to make a general liability insurance claim is when a third party files a lawsuit or makes a complaint about property damage or bodily injury. It also includes advertising injury.
What Does A General Liability Policy Cover?
#1: Third-party bodily injury
When any customer suffers injury involving your business, the medical cost of the treatment is covered under insurance. It covers the legal fees as well!
Example: A customer visits your hair salon and stumbles upon the toolbox, resulting in a leg injury. This is a third-party injury, and this injured customer can sue you for damages. General liability insurance can recover all damages, medical expenses, and lawsuit costs.
#2: Third-party property damage
This insurance shields you when you mistakenly damage a third party’s property.
Example: Your food truck, while in reverse gear, bumps into a nearby house’s fence. This causes damage to this third party’s property, and he can sue you and ask for damage costs. But since you have policy coverage, the insurance company will take care of the raised liability for repairing the fence.
#3: Product liability
A business not only manufactures products. It is also involved in distribution as well as selling of products. A lawsuit can be filed against the company when any product harms people. This policy covers those costs.
Example: A buyer gets an allergic reaction after buying organic fertilizer from a lawn care company. Due to allergy, the buyer doesn’t work for four days and sues the company for her lost wages and medical bills. General liability insurance will cover these lawsuit costs.
#4: Advertising injuries
General liability insurance also helps businesses in the case of advertising injuries like copyright infringement, libel, or slander.
Example: A paint manufacturing company accuses another paint manufacturer of using its copyright information in the advertisement. He further files a lawsuit for this advertising injury, but the insurance company will take care of it if you have this policy.
How Much Do I Need To Pay For General Liability Insurance?
The average amount is around $42 every month.
But the actual premium for your general liability insurance depends on factors like location, industry type, risk factor, workforce strength, and coverage amount will be considered.
How To Make A General Liability Insurance Claim?
#1: Talk To Your Insurance Agent
Bring the accident to your insurance agent’s notice as soon as possible. When you notify the agent soon, your claims take less time for resolution.
#2: Gather All The Details Of The Policy
If you ever need to file a claim, you should check your general liability insurance details. All the relevant information about the insurance policy is there.
It usually tells you to provide information like name, address, contact details, business name, policy number, claim description, injuries, medical treatment and date of loss, etc., to the insurance provider.
But it is crucial to be sure about all the details mentioned above to avoid any issue in evaluation and terms of your coverage.
#3: Clarify doubts
You may not be able to file a claim if you are unsure about the following things:
- Time constraints
- Coverage not given under the policy
- Ways to deal with the lawsuit
- Incidents covered in the policy
At times, you are unclear about particular policy and policy claim-related terms. I highly recommend asking the insurance agent to clarify your doubts.
#4: Records Details Of The Third party
You should write down all the communication details made with the third party. All data is essential, whether emails, telephonic conversations, or in-person talks. And you should record the communication with your insurance agent as well!
#5: Weigh your options
And there are chances that the third party files a lawsuit against you. Be ready! And when such a situation arises, the insurance provider suggests the below course of action:
- Accept the allegations made on you or deny them. Also, be prepared with an explanation.
- To avoid the consequences of a lawsuit, try to dismiss it.
- The other way is to go for the settlement with the third party out of court. This will save you from legal expenses.
In A Nutshell…
Such events can occur to any business owner. But, when you are insured with the right policy, you can avoid these unnecessary financial hiccups. You shield yourself from all such third-party claims when you take a general insurance policy.
Also, the laws keep changing, so stay updated with the newest rules on how to make a general liability insurance claim. So, this was all about making claims. I hope it cleared all your doubts and was helpful. But if you have any more queries, please drop them in the comments section. I am all ears!
