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General liability insurance is the type of insurance that covers your business from lawsuits regarding personal injuries. If you are just starting your journey as an entrepreneur, you might be wondering: How much is this going to cost? The finances of your business are at the core of your operations. Each decision that you make affects the expense and profit that your business encounters. Let’s get into the details of general liability insurance, so that you can begin to understand how it will affect your finances.
What Is General Liability Insurance?
As a business owner, you may have to buy several separate kinds of insurance. Some plans will protect your products, others will be related to theft and equipment damage.
One of these policies will be titled “General Liability Insurance”, and it is in place to help you in case an individual makes a claim against your business. Claims can be unexpected. Do you think the McDonald franchise ever thought someone would sue them for having coffee that was too hot? They can also be outrageous.
A claim can be related to bodily injury that was sustained on your property, property damage that has occurred, or personal injury which can include psychological and emotional damage.
Whatever the claim may be, general liability insurance’s purpose is to pay for the fees associated with taking the claim to court. The insurance could pay for investigating the case, hiring a lawyer, and even part of the medical bills if your business is found at fault.
How Will My Insurance Policy Affect My Finances?
The rate that you pay for your insurance will depend on the type of business that you are, the number of employees that you have, and your location. One helpful survey, conducted by Hiscox, found that for small businesses with ten employees or less, the average cost of general liability insurance was thirty dollars per month.
As with many financial decisions, it is smart to consider in this case risk and reward. An inadequate policy carries the risk of financial disaster for your business if a claim is issued against you, and you do not have the financial means to defend yourself. The risk of spending more than might be necessary comes with a reward of being well taken care of when it comes time to mount a legal response or contend with an accidental injury.
Experts can help you decide what policy is right for you, or you could continue to do research online and get quotes from several companies and weigh your options. Some areas have higher risk for personal injury than others. The personal injury attorney Tampa community also finds that personal injury claims go up around certain times of the year. Consider speaking to a personal injury attorney so that you can learn about the kinds of claims that your insurance will be protecting you against.
The finances of your business will be the factor that decides whether it will continue to run or not. Budget concerns are very important. As you figure out your monthly and yearly budget, be sure to include general liability insurance in on your calculations.
“The strength of a business idea or concept is often inconsequential without the right people in place to implement the company’s specific vision for that idea, further underscoring the importance of focusing on hiring those who are most qualified to handle the responsibilities they are given.”