General Liability insurance is a foundational form of business protection that covers common risks, such as bodily injury, property damage, and personal injury claims, that can arise during a business’s daily operations. Designed for businesses of all sizes, this policy acts as a safety net against lawsuits and financial losses.
In this article, we’ll explain what General Liability insurance is and why it’s essential for businesses.
Types of General Liability Insurance Policies
Depending on the size and scope of your construction business, whether you’re a startup, a small operation, or in the middle market, as well as the requirements of your contract with project owners and developers, CCIS offers different General Liability insurance policies for the nature of your business.
What Does General Liability Insurance Cover?
General Liability insurance protects your business from third-party bodily injury and property damage claims related to your operations.
General Liability Coverage Inclusions
Subject to the policy terms and certain exclusions, a typical General Liability policy provides the following types of coverages:
Bodily Injury: Protects against accidental injuries to non-employees resulting from your operations, including medical costs and legal fees.
Property Damage: Protects against accidental damage to third-party property caused by your business.
Medical Payments: Pays for immediate medical expenses if a third party is injured on your jobsite, typically up to $5,000.
Personal and Advertising Injury: Protects against claims such as slander, libel, or copyright infringement.
Products and Completed Operations coverage can be included, depending on the type of policy. This covers claims that arise after a project is finished for work performed during your policy period.
Common Exclusions in General Liability Policies
While a General Liability policy provides broad coverage, certain exclusions may apply. For example, below are common exclusions,
- On-the-job employee injuries (covered under Workers’ Compensation insurance)
- Faulty workmanship or damage to an insured's work
- Intentional acts or harm
- Losses from vehicular accidents (covered under Commercial Auto insurance)
- Pollution liability (a separate Contractors Pollution Liability policy is necessary)
- Professional liability (a separate Contractors Professional Liability policy is necessary)
- Contractors liability (most General Liability policies aren’t designed to cover situations where your responsibility exists only because of a contract)
Who Needs Insurance for General Liability?
All businesses, including general contractors, subcontractors, and specialty and trade contractors, should carry General Liability insurance. Whether you accidentally damage a client's property or a visitor to the job site gets injured, General Liability insurance protects your business.
Additionally, in several states, contractors are required to carry General Liability insurance to obtain a license and show proof of coverage. Even if it’s not a licensing requirement, to win and work on a project, a contractor must have General Liability insurance in place.
Cost of General Liability Insurance
The cost of General Liability insurance depends on several factors, including the type of policy and the coverages offered, policy limits, the nature of the work performed, and other relevant considerations.
Factors Affecting the Cost of General Liability Insurance
- Type of Contracting Work: Insurance costs vary depending on the kind of work you do. Contractors handling higher-risk jobs, such as roofing, electrical work, or heavy construction, typically pay more than those performing lower-risk tasks, like painting or basic handyman services.
- Business Size & Financials: Factors like payroll, subcontractor costs, and gross receipts all impact pricing.
- Experience in Business: The longer a company has been operating safely, the more likely it is to qualify for better rates. Newer businesses may pay more until they establish a track record.
- Number of Employees: The more employees you have, the greater the chance of accidents or claims, so premiums generally increase as your team grows.
- Location: Working in areas with higher crime rates, severe weather, or stricter legal environments can result in higher insurance costs.
- Coverage Options: Policy limits, endorsements, and deductibles all affect pricing.
- Loss History: Businesses with few or no past claims are typically rewarded with better rates, while those with frequent or costly claims may pay more.
Pricing and How to Get a Quote
Pricing will depend on the construction work you do and the type of policy you purchase, policy limits, location, payroll, and other factors as listed above. A policy can start at around $800 and increase from there.
You can obtain a quote for General Liability with CCIS Bonds by completing our online quote form on the home page or on our state-specific pages: Arizona, California, Nevada, Oregon, and Washington.
How to Get General Liability Insurance for Your Business
Visit CCIS and complete our form to receive a quote. We work with leading insurance companies to provide competitive rates.