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Commercial general liability insurance: what is and isn’t covered?

Commercial general liability insurance helps business owners handle claims which result from their business causing third party bodily injury or property damage to a third party. An example could include a customer injuring themselves on your business property and filing lawsuit. 

There can be misunderstandings about what is and isn’t covered by commercial general liability insurance. We’re here to help. Here’s a look at common misunderstandings about what’s excluded and included in the coverage.

Commercial general liability insurance: what isn’t covered?

Damage to commercial fleets

A commercial fleet is a group of vehicles used for business purposes. If you own a fleet and a vehicle(s) becomes damaged or stolen, commercial general liability insurance won’t cover repair or replacement costs. In this case, a commercial auto policy is needed. Commercial auto insurance could help handle expenses if the commercial vehicle(s) is damaged or stolen.

Lost business revenue

Insured perils (such as a flood, fire, or sewer backup) might keep you from operating your business — in insurance terms, this is known as “business interruption” and could result in lost revenue. For example, if your business was flooded, you might have to stop operations because your property is unsafe to enter. If you had to stop business operations, commercial general liability insurance wouldn’t provide coverage. This is where business interruption insurance is needed. While dependent on the policy, business interruption insurance could provide compensation for lost revenue if you had to suddenly stop operations, due to an insured peril.

Experiencing a loss from uninsured business operations

If a business owner doesn’t inform their insurance company or BrokerLink commercial insurance broker about new operations, commercial general liability insurance may not provide coverage. Specifically, this is if the new operations caused third party bodily injury or property damage. For example, you own a landscaping business and decide to do snow removal. To do this, new equipment is purchased. While you’re removing snow, you hit a parked car. If you didn’t provide information about your new business operations, your commercial general liability policy may not provide coverage. This is why it’s important to inform your BrokerLink commercial insurance broker about any changes to your business operations. They’ll update your coverage so it reflects your business operations.

Expenses to handle the result of a cyberattack

A cyberattack occurs when someone intentionally tries to damage a computer system or network. An example of a cyberattack is stolen customer credit card numbers. Commercial general liability insurance typically doesn’t cover losses from cyberattacks. For this reason, it’s important to consider cyber insurance. Depending on the policy, cyber insurance could help you pay for expenses related to a cyberattack, such as restoring customer data and notifying customers in the case of a privacy breach.

Refresher of what commercial general liability insurance covers

Third party property damage

If your business damages someone else’s property, you be held liable. If this occurred, commercial general liability could help pay for expenses. For example, if a painter spilled paint on a client’s floor, commercial general liability could help them handle costs to repair or replace the floor.

Third party bodily injury

You could be sued if someone, such as a customer, enters your business property and gets injured. This could include someone slipping on ice on the doorstep of your business property. If this occurred, commercial general liability insurance could help with legal expenses.

Have questions? We have answers

Our commercial insurance experts will go through the risks your business faces and identify the right insurance coverages. They also have the expertise to answer your business insurance questions. Whether its questions or insurance advice, we’ve got you covered.