UNDERSTANDING BUSINESS
LIABILITY INSURANCE COVERAGE
Someone slips and falls at your retail establishment, and your business liability insurance denies your claim. Do you have any other options for recourse? A competitor sues you for libel because of a reference you made to them in an advertisement you ran, will your insurance cover this?
Business liability insurance is a must-have for any commercial enterprise in California, especially if you’re one of the 4-plus million small businesses operating across the state.
If you are facing a dispute over claims with your insurer and you live in the Greater San Francisco Bay Area, including San Jose, Santa Clara, San Mateo, and Oakland, you can rely on the experience of The Law Office of David H. Schwartz, INC. For nearly five decades, attorney David H. Schwartz has been providing reliable legal counsel and representation on matters related to business liability and business litigation to clients across the Bay Area. Reach out today to learn more about how he can help you with your case.
Understanding Business Liability Insurance
As pandemic restrictions are gradually lifted, California’s 4.1 million small businesses and 7.2 million employees should soon be returning to full operations. As they do, their owners will once again need to rely on business (or commercial) liability insurance to protect themselves against a variety of possible damage or loss claims.
What Claims Does Business Liability Insurance Cover?
Business liability insurance covers a wide range of potential claims, including:
Bodily Injuries and Property Damage: A customer may slip and fall, resulting in injuries, or may accidentally damage a customer’s property.
Advertising Injury: In the course of promoting your own business, you defame a competitor who brings a claim against you.
Copyright Infringement: You use someone else’s work in advertising your business and infringe on their copyright, knowingly or not.
Reputational Harm: You say something in an interview about a competitor that negatively impacts their business.
What Claims Aren’t Covered?
A slip-and-fall claim can cost $20,000 on average, and the costs of a reputational harm lawsuit start at $50,000 and rise from there. Without liability insurance, your business would be on the hook for those expenses, but there are limitations. What business liability insurance doesn’t cover includes all of the following:
Employee Injuries and Illnesses: For this, you need workers’ compensation insurance.
Damage to Your Own Business Property: This requires commercial property insurance.
Errors in Professional Services: If you provide professional services such as accounting or finance, you’ll also need professional liability insurance, or errors and omissions insurance.
Claims that Exceed Your Policy’s Limits: For this, you’ll need commercial umbrella insurance.
Cyber Liability: If someone unauthorized accesses unencrypted personal information (data) retained by your firm, you can be liable. For this, you need cyber liability insurance.
Injuries and Damages Caused by Vehicles Used by Your Business: For this, you need business auto insurance.
Illegal Acts or Wrongdoing by You or Your Employees: Unfortunately, there is no coverage available to account for these types of incidents.
Insurance Requirements in California
Business liability insurance is not mandated by law in California. Workers’ compensation insurance is, however. You cannot operate a business in California if your employees are not covered for workplace injuries and illnesses, which include threats like COVID-19.
Business auto insurance is the only other mandated insurance in California, but it applies only to vehicles owned by the business in their name (title belongs to the company). If your employees use their own vehicles in the service of your business, you should consider covering yourself for possible claims arising there as well.
Overall, you should seriously consider general business liability insurance if:
You have a store, office, or building that’s open to the public, clients, or vendors
You handle others’ property or work near client property
You advertise or create marketing materials for your business
You use social media personally or professionally
Filing a Claim or Disputing a Denial
Insurance companies all employ insurance adjusters to deal with claims that arise. It is the duty of these adjusters to keep compensation for claims to a minimum, if not deny them entirely. If you deal with an adjuster on your own, they’ve been known to use every trick in the book to trap you into a statement that can be used to low-ball or deny your claim.
It’s not unusual to get into a dispute with the insurance company underwriting your business liability coverage. When this happens, you should rely on an experienced business litigation attorney to help you pursue a favorable outcome.
Get Help from an Experienced
Business Litigation Attorney
While business liability insurance will cover many third-party claims, most policies also include a number of different exclusions and technicalities that can result in a dispute or even a denial. If you find yourself in a situation where your insurer fails to act or outright denies your claim, attorney David H. Schwartz has extensive experience representing clients involved with insurance claim denials, and those facing stalling tactics by their insurer. He will vigorously represent you in negotiations, or litigation if it comes to that.
To schedule a consultation about an insurance coverage dispute in the Greater San Francisco Bay Area, contact The Law Offices of David H. Schwartz, INC. now.