What Commercial General Liability Covers
A commercial general liability policy typically provides coverage for:
- Bodily injury — customer or third-party injuries on your premises or caused by your operations
- Property damage — damage to someone else's property caused by your business
- Personal and advertising injury — libel, slander, copyright infringement, and similar claims
- Products and completed operations — claims arising from products sold or work completed
- Medical payments — limited first-party medical coverage for minor injuries
General liability does not cover employee injuries (that is workers compensation), professional errors (that is professional liability), or damage to your own property (that is commercial property).
Who Needs General Liability Insurance
Virtually every business needs general liability. Common situations where it applies include:
- A customer slips and falls at your location
- Your employee accidentally damages a client's property
- A product you sold causes injury or damage
- A contractor's completed work causes a problem after the job is done
- A landlord requires proof of liability coverage before signing a lease
- A contract requires you to name another party as an additional insured
Standard Limits
The most common general liability limits are:
- $1,000,000 per occurrence
- $2,000,000 general aggregate
- $2,000,000 products and completed operations aggregate
Some contracts, leases, or industries require higher limits. An umbrella or excess liability policy can provide additional limits above the primary general liability policy.
Additional Insured Endorsements
Many contracts require a business to add another party as an additional insured on the general liability policy. This extends certain coverage protections to the named additional insured. Common requestors include general contractors, property owners, landlords, and project owners. The specific wording of the additional insured endorsement matters and should be reviewed carefully.
Products and Completed Operations
Products and completed operations coverage protects against claims arising from products that have been sold or work that has been completed. This is important for contractors, manufacturers, distributors, and retailers. Some contracts require that this coverage remain in place for a specified number of years after project completion.
What Affects General Liability Cost
Pricing is affected by:
- Type of business and industry
- Annual revenue, payroll, or square footage depending on class
- Number of locations
- Products sold or services performed
- Loss history
- State of operation
- Coverage limits selected
Frequently Asked Questions
Is general liability the same as commercial liability?
Yes. Commercial general liability (CGL) and general liability refer to the same type of coverage. It is the foundational liability coverage for most businesses.
Does general liability cover professional errors?
No. Professional errors and omissions are typically excluded from general liability policies. A separate professional liability or E&O policy is needed to cover claims arising from professional services.
Does Vesper write general liability in multiple states?
Yes. Vesper Insurance Group writes commercial general liability across multiple states for a wide range of business types.
What is an occurrence policy versus a claims-made policy?
An occurrence policy covers claims arising from incidents that occur during the policy period, regardless of when the claim is filed. A claims-made policy covers claims that are both made and reported during the policy period. Most general liability policies are written on an occurrence basis.