Fine Print Guide

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General liability

Covers your business when someone outside it claims you injured them, damaged their property, or harmed them through your advertising, and pays for your legal defense.

Who it's for
Nearly every business that deals with customers, visitors or clients' property. Clients and landlords often ask for proof, a certificate of insurance.
Is it required?
Not by law, but commonly required by leases, client contracts and licensing for trades.

Usually covered

  • Injuries to customers, visitors and the public caused by your premises or work
  • Damage to other people's property
  • Harm from something you sold or work you finished, after you've finished it
  • Libel, slander and copying someone's advertising idea
  • Your legal defense, usually on top of the limit

Usually not covered

Real-life examples

A plumber's fitting fails a week after the job and floods the client's house.

Usually covered

Damage from finished work is covered under products and completed operations. The cost of replacing the faulty fitting itself usually isn't.

A competitor says your ad copied their slogan.

Usually covered

Advertising injury (Coverage B) usually covers this, including your defense.

A consultant's advice costs a client $200,000.

Usually not covered

Financial harm from advice isn't bodily injury or property damage, so general liability doesn't apply. That's professional liability.

The parts of a general liability policy

ABodily injury and property damageHarm to people and things

The main part: someone hurt, or someone's property damaged, because of your business. Includes products and completed operations.

BPersonal and advertising injuryHarm through words and ads

Libel, slander, invasion of privacy, false arrest, and using someone's advertising idea or copyright in your ads.

CMedical paymentsSmall medical bills, no-fault

Pays a visitor's minor medical bills without anyone needing to prove fault, which often heads off a lawsuit.

Good to know

Limits: "$1M / $2M"

General liability usually has a per-occurrence limit and an aggregate limit, like $1 million per occurrence and $2 million per year. Contracts often specify both.

Adding clients as "additional insured"

Clients may ask to be named an additional insured, so your policy also defends them if your work leads to a claim against them. It's common and usually done with an endorsement.

Check your own policy

Find these on your policy or declarations page, or ask your agent:

  • Per-occurrence and aggregate limits
  • Whether it's an occurrence policy
  • Which work is excluded for your trade
  • How to add an additional insured

Not sure where to look? See how to read your policy.

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