What is the difference between General and Professional Liability Insurance? What are the benefits and limitations of each type of coverage? And what are the requirements for each? These questions will be answered in this article. Read on to learn more about the differences between general and professional liability insurance and how they can benefit your business. Here are some examples:
Benefits
If you are in the construction business, you may be wondering what benefits general and professional liability insurance can provide to you. It can help you protect your business from lawsuits and help you secure more contracts. Many firms require contractors to have insurance before bidding or closing a contract. Having insurance puts you ahead of your competition. Here are a few of the most important benefits of general and professional liability insurance. Read on to learn more about these advantages.
General liability insurance protects your business from lawsuits that result from errors made during your work. The policy will cover the medical costs of a client if they are injured on your property. It also covers legal expenses if a client files a lawsuit against you. In addition, general liability insurance can cover injuries and damage to another person’s property. These benefits make general and professional liability insurance an essential part of any business.
Differences
General and professional liability insurance are two types of insurance coverage. General liability covers damages resulting from physical injuries and property damage. While professional liability covers financial loss, general liability only covers property and bodily injury. This is a very important insurance policy for any business that is exposed to the risk of lawsuits. For example, if a contractor installs a board with a hole through it, he or she will be liable for a customer falling through it due to faulty workmanship. The latter is more specialized and specifically designed to cover a wide range of risks.
Many clients will require that businesses carry these policies. Prospective clients will likely demand proof of insurance from contractors if you are in the construction business, as not having insurance may prevent important projects. Some construction companies will insist on seeing proof of insurance before hiring subcontractors. Similarly, landlords and property owners may require it as a condition of leasing their property. However, despite the many benefits of having insurance, you should make sure to review your risk-level carefully before choosing a policy.
Costs
General and professional liability insurance premiums depend on the type of business you run. Increasing the number of employees will increase your premiums because you’ll be covered for the actions of your employees. Insurance companies classify companies by size and then group them together based on their level of risk. For example, a company with five employees will be placed with those with six to ten employees. Businesses with more than twenty employees will be placed in the same category.
Costs of general and professional liability insurance vary greatly, but average premiums are about $597 per year or $50 per month for small businesses. A general liability insurance policy pays up to $1 million for any single claim, and $2 million for all claims. The cost of this coverage depends on the size of the business, its industry, location, and the amount of coverage needed. Most business owners choose a business owner’s policy that combines general liability insurance with business property insurance. But if you’re just starting out and need more coverage, you can purchase general liability insurance separately.
Requirements for coverage
Having both general and professional liability insurance policies can protect you and your company from the risks associated with the different types of business operations. General liability insurance covers bodily injury and property damage, while professional liability policies cover a more cryptic list of risks, such as mistakes in rendering services. These policies are generally written on a “claims made” or “occurrence” basis. Some states even mandate that certain businesses carry a certain amount of general and professional liability coverage.
As a contractor or vendor for Tufts University, you must name Tufts University as an additional insured on all general and professional liability insurance policies. While you do not need to name Tufts University as an additional insured on your workers’ compensation or professional liability policies, you must specify this on your certificate. This way, you can protect your business from any unexpected liability and keep your business operating smoothly.
