About General Liability Insurance
All businesses, regardless of industry, face risks that should be covered by insurance. The most common and comprehensive type of policy business owners invest in is general liability insurance (or CGL).
Some of the risks CGL insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
While businesses aren't legally required to carry general liability insurance, operating without it is extremely risky. If your business is sued, you could end up facing fees totaling hundreds of thousands of dollars (or more). Having a sufficient CGL policy in place to help compensate for these damages is the only way to prevent this type of event from devastating your business.
Learn more about the risks covered by general liability insurance.
COMMON SITUATIONS THAT GENERAL LIABILITY INSURANCE WOULD COVER FOR A DRIVE-IN MOVIE THEATER
Example 1: A customer walks to your snack bar and trips on a speaker cord from another vehicle. As they fall, they break a wrist and hit their head. General liability insurance would cover their medical expenses as well as legal fees and any awarded settlement if they decide to sue.
Example 2: A parking spot with a broken speaker system needs its entire mechanism replaced. As an employee brings the new equipment over in a cart, they lose control of the cart and it hits a customer’s car. The impact damages a door. General liability coverage would cover the vehicle repair costs.
Example 3: While installing an ice cream machine in your snack bar, a vendor slips on the wet floor and injures their head and wrist. The vendor is upset that no “caution” sign was visible and threatens to sue. Your general liability policy would pay for the vendor’s medical bills and your legal fees if the claim goes to court.
Of course, this is not an exhaustive list of perils a general liability insurance policy will cover, and some conditions may result in a particular peril not being covered. It's always best to talk to your agent in-depth about the specifics of your policy to avoid blind spots in coverage.
Cost Of General Liability Insurance
On average, drive-in movie theaters in America spend between $500 - $1,100 per year for $1 million in general liability coverage.
Check out the chart below for a snapshot of average CGL expenditure across a variety of industries:
Several factors will determine the price of your policy. These include your:
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner's policy (BOP) rather than as a standalone policy. A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
Other Types Of Coverage Drive-In Movie Theaters Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some other types of insurance all drive in movie theaters should obtain:
Workers’ Compensation Insurance
Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover but also any disability benefits stemming from a work-related accident.
Commercial Property Insurance
If you own the lot and storage buildings used for your drive-in theater, you’re responsible for all business-related property housed there in the event of a fire or other natural disaster. Commercial property insurance would cover the cost of repairing or replacing your specialized equipment and other business property after an accident so you can reopen as soon as possible.
Types Of Coverage Some Drive-In Movie Theaters May Need
In addition to the policies outlined above, there are a few other types of coverage your drive-in movie theater may require depending on certain aspects of your operations. Some of these might not apply to you, so be sure to ask your agent which policies are right for your business.
Commercial Umbrella Insurance
While your general liability insurance policy covers most claims, some accidents or lawsuits may be so catastrophic that they threaten to exhaust the limits of your primary coverage. Commercial umbrella insurance protects you from paying out-of-pocket for any legal fees and awarded damages that exceed your primary policy.
Data Breach Coverage
If you offer a rewards program for your returning customers, you’re responsible for securely storing any personal data they provide as part of that membership. In the event of a cyber-attack or other data security issue, data breach insurance would cover your legal fees and any damages from a resulting lawsuit.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it should not be your frontline defense. Yes, insurance will compensate for your business’ financial losses after an incident occurs, but it’s much better to avoid losses altogether.
With this in mind, here are three things you can do to better protect your business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up a limited liability company (LLC) or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Streamline your business’ internal processes. This will remove unnecessary variables from common tasks and create a safe, consistent environment for conducting business.
Steps After Getting Business Insurance
Depending on where you are in your business building process, here are some other actions you may need to take before getting started:
- If you’re just starting, finding the best name for your business is a great first step. Check out TRUiC’s Business Name Generator.
- After finding the perfect name, get a logo with our Logo Generator.
- Every business needs a website. Using a website builder like the GoDaddy Website Builder or Wix makes building a website simple and fast! Check out our review of the Best Website Builder.
Frequently Asked Questions
What is included in a business owner’s policy?
A typical business owner's policy includes general liability, business interruption, and property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company's needs.
What is the difference between business insurance and general liability insurance?
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Do I need insurance before I start a business?
You should invest in coverage for your business before your first interaction with a customer. Although the cost of insurance may seem high for a brand new business, it's best to be proactive when it comes to protecting your assets. After all, you can't buy insurance to cover a loss that has already occurred.
Will insurance protect my business from everything?
Not necessarily. Certain exceptions may be written directly into your policy, and some perils may be entirely uninsurable. Be sure to discuss the scope of your policy in-depth with your agent to avoid being blindsided by holes in your coverage.