Protection from a Range of Liability Claims

It’s estimated that American companies will face $183 billion in tort costs in 2011, $152 billion of which will land on small businesses.1

Accidents happen no matter how well a business is run, and the expenses involved in defending a lawsuit can prove to be devastating, whether the organization is found to be at fault or not. Fortunately, there are several forms of liability insurance that may help offset unforeseen costs (up to the policy limits) that could consume your business’s profits or ruin its longer-term prospects.

The commercial general liability coverage offered with a business owner’s policy helps protect against risks associated with property damage, bodily injury, and personal and advertising injury. However, different kinds of coverage may be warranted for businesses exposed to special risks that may not be included in a standard policy.

  • Professional liability insurance (or errors and omissions coverage) could help with legal costs and damages related to wrongful practices by professional service providers such as doctors, lawyers, and various types of consultants. Typically, it is necessary to obtain coverage that is specific to the company or industry.
  • Product liability insurance could help protect against financial loss resulting from a defective product that causes injury or harm. Companies that manufacture, distribute, or sell such products could potentially be held responsible for their safety.
  • Internet liability insurance could help protect firms that conduct business on the Web from risks related to computer hacking, spam, viruses, and other online perils.
  • Employee benefits liability endorsements could help pay costs that result from negligence related to the administration of employee benefits, even if they are managed by an outside professional benefits administrator.

As your business grows, you could encounter new risks and may want to expand coverage based on the size of your staff or the value of equipment and other assets. Reviewing your liability insurance on a regular basis could help protect you from the possibility of a lawsuit that could stifle your business or harm your personal financial situation.

1) U.S. Chamber Institute for Legal Reform, 2010

The information in this article is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2011 Emerald Connect, Inc.
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Annette Hammortree, Registered Representative & Financial Advisor of Park Avenue Securities LLC (PAS), 8010 Excelsior Dr, Suite 200, Madison, WI 53717 (608)828-9800. Securities products/services and advisory services offered through PAS a Registered Broker-Dealer and Investment Advisor.  Annette Hammortree, Financial Representative of The Guardian Life Insurance Company of America (Guardian), New York, NY.  PAS is an indirect wholly owned subsidiary of Guardian.  Hammortree Financial Services is not an affiliate or subsidiary of PAS or Guardian.

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