General Liability Insurance Policy

Learn What’s Protected Under General Liability Insurance Coverage

Business general liability insurance coverage is something most business simply must have, so it is essential that you understand what it does and doesn’t cover.

Here are some general liability insurance coverage rules of thumb. To be sure about your specific business needs, be sure to consult with a qualified business insurance agent.

What’s typically protected by commercial general liability insurance coverage

Business is inherently risky, but business liability coverage safeguards against many known and unknown risks. Commercial general liability insurance coverage protects you, your business and your employees from claims involving bodily injury or property damage, up to the limits of your policy. Policies shield you from the expense of out-of-court settlements, litigation and judgments awarded by courts.

Lawsuits, investigations and settlements

If damages are filed against you or you’re sued, general liability insurance covers the insurance company’s investigation and attorney expenses, any judgment or settlement, medical expenses in case of injury and bonds if they must be subsequently posted.

Injury damages

Claims can arise from bodily injury or property damages resulting from accidents on your premises or from your products, your operations or advertising for your business.


General liability insurance can also cover things you may not have thought about, such as advertising injury in the event your company’s marketing violates someone’s copyright. Business general liability insurance coverage even offers some protection against alcohol-related accidents (as long as your company is not in an alcohol-related business, such as the manufacture or distribution of alcohol).

Learn what’s covered by other types of Nationwide commercial policies, including businessowners policies, commercial property insurance and commercial auto insurance.

What’s typically NOT protected by business general liability coverage

Here are some situations that would not be protected by general liability insurance coverage.

Employee injuries

Workers’ compensation is the insurance you would need to protect your employees when they are hurt on the job.

Professional mistakes

Business general liability insurance coverage won’t cover a professional mistake, but professional liability will. It insures against mishaps that may occur as you offer your opinion, solution, service or recommendations in the course of business.

Auto-related coverage

Business liability coverage does not protect you against auto accidents. Purchase a separate auto policy to protect your business.

Punitive damages

Though there can be exceptions, a general business liability policy rarely pays for punitive damages resulting from a lawsuit.

Intentional acts

General business liability insurance does not cover damages or injuries resulting from expected or intentional acts. For example, if an employee assaults a customer, your business liability coverage would not cover the damages if they sue. But if the employee was defending himself or the company from a criminal act, the liability insurance would provide coverage.

Referred to as the “workmanship” exclusion, and is common in general liability policies. Insurance policies do not respond to what would normally be picked by a company’s warranty for their work.

General Liability Insurance

How much does general liability insurance cost?

A variety of factors are considered for general liability insurance quotes, including policy limits and business operations. Policies start as low as $21 a month for basic coverage.

Average costs for Insureon customers

The average annual cost of general liability insurance, regardless of policy limits, is $741 (less than $62 per month), with a median price of $428 (about $36 per month). Most small business owners (54 percent) paid between $400 and $600 for their policies, and 21 percent paid less than $400.

These figures were derived from an analysis of more than 18,000 small businesses with 10 or fewer employees that bought policies from Insureon in 2017.

What small businesses pay for general liability insurance

Industry risks impact commercial general liability insurance costs

Our analysis of general liability insurance costs reveals that industry has the biggest impact on policy costs. Generally, high-risk industries pay higher premiums, while low-risk industries enjoy lower rates.

For example, brick-and-mortar retailers open to the public are exposed to more risk than IT consultants working remotely from a home office. The graph below illustrates how the industry you work in affects what you’ll pay for a general liability policy with an aggregate limit of $2 million and a per-occurrence limit of $1 million (our most popular policy limit; see below). Hover over the bars to view exact values.

Average cost of a $1M / $2M general liability policy by industry

Janitors, construction businesses, and manufacturers have the highest coverage costs because those industries often do work that involves someone else’s property. General liability policies can pay for damage you or your employees cause to someone’s property.

To see insurance costs for businesses in your industry, visit our industry-specific cost analyses:

How coverage limits affect insurance costs

If you want car insurance that pays for a wide range of damage, you have to pay more for it. The same rule applies to business insurance: If you want a policy with higher coverage limits, expect to pay more than you would for basic coverage.

The most popular general liability policy among Insureon customers is the $1 million / $2 million policy. This includes:

  • $1 million occurrence limit. While the policy is active, the insurer will pay up to $1 million to cover any single claim.
  • $2 million aggregate limit. During the lifetime of a policy (usually one year), the insurer will pay up to $2 million to cover claims.

Which general liability limits do small businesses choose?

The majority of Insureon customers (85 percent) chose a policy with $1 million / $2 million limits. Twelve percent of our customers chose a policy with $2 million / $4 million limits, the next most popular choice.

What small businesses pay for $1M / $2M general liability insurance

The average cost of a $1 million / $2 million general liability policy is $1,283 per year, and the median is $584. For those limits, 53 percent of Insureon customers pay between $400 and $600 per year, and 22 percent pay between $200 and $400. In other words, 75 percent of our customers pay $600 or less per year for this coverage.

Tips for finding general liability cost savings

  • Bundle your insurance policies. With insurance, businesses can sometimes find discounts when they purchase multiple policies from the same provider. For example, if your business is considered low risk, you may qualify for a business owner’s policy. A BOP bundles commercial general liability and property insurance together at a reduced rate.
  • Pay your entire premium upfront. Your general liability policy premium can typically be paid in monthly or annual installments. It might be tempting to go with a smaller monthly payment, but consider paying your premium upfront. Businesses can usually find savings this way because many insurers offer discounts for premiums paid in full.
  • Proactively manage your risks. If your small business has a clean claims history, expect to pay lower insurance rates. An effective way to do this is to create a comprehensive risk management plan. For example, you might:
  • Develop a thorough training program for employees.
  • Invest in a security system.
  • Compile rules for posting to social media.
  • Create procedure checklists and reviews.
  • Minimize hazards on your premises.

Dig deeper into business insurance costs

Insurance costs vary based on the type of insurance a business buys. Learn more about how much these insurance policies cost for small businesses.

General Liability Insurance


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What is Commercial General Liability Insurance?

General liability insurance protects your business from another person or business’s claims of bodily injury, associated medical costs and damage to property. Some examples of what could be covered are below. View our quote examples to understand how much general liability insurance costs.

Why do I need General Liability Insurance?

We understand the risks your company faces and the importance of knowing your business is properly protected. Having general liability insurance coverage protects your business against third-party claims of bodily injury or damage to someone else’s property. However, it does not protect your own personal property. This section explains what our business general liability insurance offers. You should consider general liability insurance coverage, also called commercial general liability insurance, if you or your employees:

  • Interact with clients face to face – If you visit a client’s place of work, or clients visit yours
  • Have access to a client’s equipment – For example, IT professionals should be covered against potential claims with IT business liability insurance
  • Represent your client’s business
  • Use third-party locations for any business related activities – For example, architects should make sure that they’re covered with architects business liability insurance
  • Are required to have general liability insurance before entering into a contract

What does General Liability Insurance cover?

What is covered?

  • Bodily Injury
  • Damage to third party property
  • Personal injury
  • Advertising injury
  • Electronic data liability
  • Medical expenses
  • Defense costs
  • Actions of your full-time employees and temporary staff
  • Supplemental payments

What is not covered?

  • Your property
  • Vehicles and boats
  • Personal identifiable information
  • Professional services
  • Employee injury / workers’ compensation
  • Intent to injure
  • Coverage outside policy period
  • Known claims prior to start of policy

Example professions we insure

Your General Liability Insurance policy covers claims of

Bodily Injury

Even with careful planning and the best precautions, accidents and injuries can still happen on the job. Say, for example, one of your clients trips and falls over a bag you left on the floor. Or maybe an accident occurs while on a client’s premises. If your client is injured and if you’re legally liable, our general liability insurance can cover claims by third parties for their bodily injury.

This is a useful type of insurance for construction, architecture, and engineering professionals to have due to the various injuries that can occur to others on job sites. Contractors, such as carpenters, painters, and plumbers, can also benefit from a general liability insurance policy.

Since bodily injuries are common while exercising, personal trainers, yoga studio owners, and other fitness professionals should also have a general liability insurance policy in place to protect themselves. Even a business consultant who works in a corporate setting can benefit from general liability insurance in case a client stumbles and falls in the consultant’s office and later files a bodily injury lawsuit.

These are just a few of the many common examples of how a Hiscox general liability insurance policy can protect business owners from bodily injury claims and lawsuits.

Damage to Third-Party Property

Property damage, whether caused by you or one of your employees, can create huge expenses that you may be responsible for. We offer coverage for damages to another person or business’ property as part of its general liability insurance. Note that covered claims are for damages that you are legally liable for and not for your own property.

Examples in which general liability insurance coverage is useful for property damages include:

  • A building inspector accidentally knocks over an artisan glass window pane while making her way back to the truck. If the piece shatters and the client demands reimbursement plus delivery costs, it is important for the building inspector’s employer to have coverage for the claim up to the policy’s limits of liability.
  • A personal trainer is conducting an at-home workout session for a client and accidentally knocks over a laptop while teaching a new routine. Third-party property damage coverage may protect the personal trainer from a claim by the laptop’s owner for their property damage.

When an accident occurs, it can be difficult to determine an estimated cost of another person’s property to assess the financial damage that may result. This is why it’s wise to protect yourself and your business with a general liability insurance policy.

Personal Injury

Personal injury claims often arise out of claims of libel and slander in business environments. Libel is a false statement that damages a person’s reputation in written or electronic form, while slander is a claim for a verbal statement that is false and damaging to someone and a person’s reputation. These can be very serious claims, which is why our general liability insurance coverage can protect you against claims of libel or slander for which you are legally liable.

If you run a construction business, for example, and have employees who are out to lunch and talking about one of your clients in a false and unflattering way, you could be sued for slander. At Hiscox, we may cover the subsequent claim, up to your general liability policy’s limits of liability, and pay for an attorney to defend you, if needed. Situations like this could also arise if you operate a personal training business, pilates studio, massage therapy business, spa, or hair salon. Whether you personally commit the act of libel or slander or your employees do, your business could suffer great financial loss from having to defend or pay for a claim that arises out of the situation if you don’t have general liability insurance.

Advertising Injury

Our general liability insurance provides protection against the unintentional use of a third party’s advertising idea if it was used as part of your advertising. We may also protect you if your advertisement or marketing materials infringe upon a third party’s copyright or trade slogan. This is one of the best reasons for marketing professionals to choose us for their insurance needs.

We also provide advertising injury coverage to professionals in fields like control systems integration, engineers, project management, and acupuncture services. Advertising injury coverage also extends to art therapists, barbers, beauticians, and estheticians, among a multitude of other professionals in varying industries. In some instances, a separate personal/advertising injury limit may apply.

Electronic Data Liability

Property damage can occur in many forms, including to electronic data, as well as physical property. We added electronic data liability to our list of what’s covered under a general liability insurance policy to protect a wider range of consultants and technology service providers.

Take for example an IT professional who damages a computer server while working for a client. The client’s electronic data is damaged and cannot be recovered, prompting the client to sue the IT professional for their electronic data loss. In this instance, we would cover any damages up to the IT employer’s limits of insurance for which it is legally liable. As part of our general liability coverage for business consultants, we offer $25,000 in electronic data liability coverage, in addition to coverage for damages for premises, rented and a separate personal/advertising injury limit. This is also the level of coverage that we offer education consultants, human resource consultants, marketing/media consultants, and other professionals for electronic data liability.

In some cases, electronic data can be just as valuable or even more so than office furniture, supplies, and infrastructure in a business environment. Choosing Hiscox for your consulting and technology insurance needs will allow us to protect you against electronic data liability claims.

Medical Expenses

If an accident occurs and someone other than you or your employees is injured, your Hiscox business general liability insurance policy may cover associated medical expenses for each injured person, up to $5,000.

Bodily injuries can occur on the job in many different industries including carpentry, HVAC contracting, construction, and electrical work. For example, a client could trip and fall over your ladder, resulting in a broken bone. Injuries could also occur in therapy professions that offer massages, such as when a client leans on the headrest of a massage table, causing it to snap off and him to fall to the ground. Or a Zumba instructor could place her gym bag on the ground before class, and a student trips over it and strains a muscle.

In all of these hypothetical situations, a small business could be sued for the medical expenses that result from injuries. Medical expenses can easily soar to thousands of dollars, even for injuries that appear to be minor. Protect yourself and your business with a general liability insurance policy.

Defense Costs

Legal fees can easily soar into the thousands of dollars if you don’t have a plan in place for your defense. If you are sued for a general liability claim, we will appoint a lawyer if necessary, even if the lawsuit is groundless.

Defense costs can put a serious strain on small businesses, such as salons, spas, therapists, and freelancers. Other professions that frequently benefit from defense cost coverage as part of our general liability insurance policies include architects, accountants, insurance agents, photographers, electricians, audiologists, computer programmers, graphic designers, hypnotherapists, and landscapers.

We will cover defense costs on your behalf without reducing your limit of liability. If you’re running a small business, you can’t afford to not have general liability insurance to pay for high legal fees in connection with legitimate or frivolous claims made against you or your business.

Actions of Your Full-Time Employees and Temporary Staff

At Hiscox, our general liability insurance coverage extends not just to actions of your full-time employees, but to temporary staff, as well.

  • An employee of a real estate brokerage firm accidentally drives a stake through a water line while putting up a neighborhood sign and causes serious damage to a homeowner’s lawn.
  • A yoga instructor who works for a yoga studio owner is teaching a class where a student loses his balance, falls into a mirror, and injures himself.
  • After having a few drinks at the bar, a computer programmer’s assistant talks loudly about an executive at a client company.

In all of these examples, your business could be sued due to the actions of an employee, regardless of whether the employee is full-time or temporary. We can help you stay protected.

Supplemental Payments

If a claim is filed against your business, there are many expenses that can follow, and many that you may not know to expect. As small business insurance experts, we are well aware of all of the hidden expenses and extra fees that commonly come along with defending you and your business against claims, and we’re ready to put our expertise to work for your benefit. This includes:

  • If one of your clients, a business, or another third-party files a claim against you, we may cover legal defense costs if incurred.
  • We may also cover up to $250 per day for the loss of your earnings and pay for reasonable expenses you incur as a result of assisting us in the investigation of the claim against you.
  • We also provide interest on damage awards as part of our general liability insurance policies

These are examples of hidden costs that may arise and add up if you’re not working with an insurance company that understands the toll that claims and lawsuits take on business owners. Whether you work in IT, marketing, therapy, health, fitness, contracting, beauty, engineering, or another vertical, we are here for you.

Worldwide Insurance Coverage

Today’s modern and mobile world requires business professionals to travel on a regular basis to meet the needs of their clients. At Hiscox, we understand this, which is why we cover damage that occurs in the United States, its territories, and Canada. In addition to damage coverage closer to home, we also offer coverage for short periods of travel outside these areas for work purposes.

This is important to professionals who need to work in various places as a normal course of business, such as architects, engineers, and management consultants. Health professionals, such as acupuncturists, acupressurists, and massage therapists may also benefit from worldwide insurance coverage in the event they need to travel for retreats, expos, or for individual client requests. Event planners, public relations professionals, and promoters who consistently travel abroad for clients can also benefit from our worldwide insurance coverage. Although we may insure for claims that arise from actions worldwide, they must be brought in the United States, Canada, and US Territories.

We can accommodate the general liability insurance needs of a multitude of professions spanning across all verticals. If you have any questions about our geographical coverage or the requirements to file a claim, please contact us. We’d be happy to tell you about the span of our coverage for business professionals and how to make the most of your insurance coverage.

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