How to Obtain General Liability Insurance

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If you’re among the 33.2 million small businesses operating in the U.S., having the correct insurance is essential. Whether local law requires you to obtain general liability insurance for your business or you simply want the protection it provides, getting a policy is reasonably straightforward. Here’s a look at how to obtain general liability insurance.

Choosing an Insurer

When you’re looking for general liability insurance, you’ll need to select an insurer. In most cases, it’s best to focus not only on the cost of coverage but also on the provider’s reputation. Ideally, you want an insurer with a simple claims process that is also known for offering exceptional customer service. By doing so, you increase the odds of any claims moving forward smoothly.

Often, it’s best to create a short list of trustworthy insurers. Then, you can collect quotes from each, compare the coverage, and review the prices, allowing you to select the policy that offers what you require for the best price.

Selecting Policy Limits

Most basic general liability insurance policies cover $1 million per incident, up to $2 million total across all incidents during a year. However, some small businesses may need more coverage, while others could potentially get away with less.

If you want to get an accurate quote and ensure the policy meets your needs, selecting an appropriate policy limit is critical. Often, you’ll want to assess the risks associated with your company type, operations, and industry, using them as a guide. However, you can also consult with a neutral insurance professional to get guidance.

Documentation to Provide

When you’re applying for general liability insurance, you’ll need to provide specific information to the insurer. Typically, this includes details about your small business, including its annual revenue and number of employees. Details about your operation and industry are similarly essential, as those allow the insurer to more accurately assess the risks related to issuing the policy.

Most providers also want information about your claims history. Again, this is critical for estimating their risk, as a history of numerous claims usually shows that subsequent claims are more likely to occur than if you’d had few or no incidents in the past.

State-Specific Requirements

In most cases, general liability insurance isn’t required by law. However, there are some state-specific requirements that can make it mandatory. For example, businesses in specific industries known for higher risks may be required to get general liability insurance to obtain or maintain various business or professional licenses. States may also have rules about the minimum amount of coverage that meets any legal requirements.

Additionally, states may have additional rules regarding general liability insurance, such as making specific endorsements or riders mandatory. However, others may allow that coverage to come from a separate policy instead, giving small business owners more flexibility.

In most cases, it’s best to research state-specific requirements before looking to obtain a general liability policy. That ensures you’re well-informed about what the coverage needs to include before requesting quotes, leading to a more accurate estimate and making it easier to compare providers.