General Liability Insurance discounts and questions
Pays when your business is blamed for injuring someone or damaging their property, and pays the lawyer whether or not the claim has merit. It is the policy landlords, general contractors and clients ask to see a certificate for before they let you on site or sign the lease.
Discounts carriers commonly offer
- Bundled business owners policy
- Packaging general liability with property in a BOP usually costs less than buying both standalone, for businesses that qualify.
- Claims-free history
- Several years without a liability claim earns a credit on the base rate.
- Safety and contract practices
- Written safety programs, signed subcontractor agreements and collecting certificates from your own subs lower the rate for contractors.
- Paid in full
- Paying the annual premium up front avoids instalment fees and sometimes earns a credit.
- Accurate audit records
- Not a discount but a saving: correct payroll and sales figures at audit avoid the additional premium a carrier charges when estimates were low.
Questions people ask
What limits does a landlord or general contractor usually ask for?
Contracts name a per-occurrence figure and an aggregate, and the figures vary with the size of the job and the counterparty; larger general contractors and public bodies ask for more, and often for an umbrella above the general liability policy. Bring us the contract before signing it. Meeting a requirement is usually a matter of an endorsement or a limit increase that costs less than losing the job, and sometimes the requirement is one we can push back on with the counterparty.
What is a certificate of insurance and how do I get one?
A certificate is a standard one-page form, issued by the agency on the carrier's behalf, that lists your policies, limits, effective dates and any endorsements naming the certificate holder as additional insured. It is evidence of coverage on the day it is issued, nothing more. Send us the requester's name, address and the wording their contract requires, and we issue it, usually the same working day; requests that need an endorsement first take longer because the carrier has to add it.
Does general liability cover my work if it is faulty?
It covers the damage faulty work causes to other property, not the cost of redoing the work itself. If a tile setter's shower leaks and ruins the ceiling below, the ceiling is covered and the shower is not. That gap is the reason contractors carry the coverage and also stand behind their own warranty; a builder's risk or installation floater covers the work in progress, and a surety bond is what a client asks for when they want the work itself backed.
I work from home. Do I still need it?
If clients visit, if you visit them, if you sell a product or if a contract asks for it, yes. A homeowners policy excludes most business liability, so a client injured at your kitchen-table office or a product you sell online are both uninsured without a commercial policy. A sole consultant who never meets clients in person has a smaller exposure and may be served by a BOP or by professional liability alone; the analysis says which.
What is an additional insured and why is everyone asking to be one?
An additional insured is a person or company added to your policy by endorsement so that your policy defends and pays for claims against them arising out of your work. Your landlord wants it so a customer injured in your unit is your claim, not theirs; a general contractor wants it so an injury on site caused by your crew lands on your policy first. Blanket additional insured endorsements grant the status automatically to anyone your contract requires, which saves issuing a new endorsement for each job.
What happens at audit?
Because the premium is rated on payroll or sales, the carrier estimates at the start of the term and audits at the end, asking for the real figures. If you grew, you owe additional premium; if you shrank, you get some back. Uncooperative audits are charged at a multiple of the estimate on some policies, so answering the audit is worth doing even when the result is a bill.