Understanding the Exclusions in General Liability Insurance Policies

General liability insurance is often an essential component of businesses’ risk management and loss control measures. This type of insurance, also known as commercial general liability insurance, lives up to its name by casting a versatile financial safety net to protect policyholders from many common incidents and risks that may occur regardless of industry. However, even the far-reaching financial protections offered by this type of coverage may have limitations.

What Might Be Excluded From General Liability Insurance?

General liability insurance may be known for its ability to protect policyholders financially from various incidents from which other parties may sustain losses. Specifically, coverage can generally issue compensation and assistance for legal fees in response to third-party bodily injuries, property damage or personal and advertising injuries for which a business is at fault.

However, many situations may lead to claim denials and a lack of coverage. Businesses should be aware of these exclusions ahead of time, as mistakenly assuming something will be covered could exacerbate a company’s difficulties. Consider the following common general liability insurance exclusions:

• Intentional acts—If it’s found that a business or its employees intentionally caused an incident from which another party suffered losses, coverage will not typically offer aid.

• Contractors liabilities—If a business assumes the liability of another party, such as contractors, acts for which that party is responsible may not be covered by the business’s insurance.

• Incidents caused by vehicles—A commercial auto insurance policy should cover a company’s automobile-related liabilities, as general liability insurance cannot do so.

• Cyber incidents—Cyber liability insurance is necessary to account for data breaches and other possible cyber incidents.

• Accusations of errors—Should a client or customer allege that a business provided inaccurate advice or made a mistake in its services, resulting lawsuits would require professional liability insurance rather than general liability coverage.

• Employee injuries and illnesses—The employers’ liability coverage included in many workers’ compensation insurance policies is key to addressing incidents involving a business’s own employees.

Get the Right Coverage

Contact Global Insurance and Tax Services today to learn more about general liability coverage or to get a free quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.