Operating a business, big or small, comes with all kinds of risks. One of those risks is that your business might be sued for causing harm to an individual or another business.
Commercial general liability insurance, commonly known as CGL, protects your business from claims and lawsuits from individuals and companies alleging that your business caused bodily injury, personal injury, or property damage.
Before reaching out to an insurance advisor about commercial general liability insurance rates in Canada, it’s important for you to do some basic groundwork. This will ensure you’ve got the right information to assist your advisor in getting the best coverage and quote for your unique needs.
While it may seem unlikely that your business could face a lawsuit, many businesses will encounter some type of legal action, or the threat of legal action, at some point in their existence. CGL protects you from the financial loss incurred by litigation, which can be very expensive.
CGL is a type of comprehensive insurance policy that protects you from lawsuits from individuals or businesses claiming bodily injury (including death) or property damage resulting from your business operations.
CGL covers non-professional negligent acts and is one of the most common types of business insurance policies.
If you own and operate a business, it’s a good idea to obtain CGL insurance. One lawsuit is all it takes to cause irreparable financial damage to your business or force you to cease operations.
Prior to meeting with an insurance advisor, you’ll want to jot down the key areas and functions of your business – be as specific as possible. This will help your advisor understand the various risks your business is exposed to.
For example, a painting company will have different risks in comparison to a management consulting company that develops business plans for start-ups.
Additionally, you’ll want to provide your advisor with key information such as your topline revenue over the past three years and the number of employees you have. You should let your advisor know if you already have CGL coverage and what amount.
Do some thinking about the risks that your business might be exposed to. While some risks will quickly come to mind, often, identifying risks is a tricky process – this is something your advisor will help you with.
However, it’s a good idea to start determining your key risks before you meet with your advisor, as this will point your advisor in the right direction with respect to determining more subtle risks that could impact your business.
A key area your advisor will focus on is the number of people you employ and whether you use contractors. Generally, the more employees you have, the larger your insurance premium will be. What’s more, contractors can expose you to additional risk, so it’s important to provide your advisor with this information to ensure an accurate quote.