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 TECHNICAL WRITING BUSINESS
Example 1: A client slips and falls on ice in your parking lot and is rushed to the hospital. He is suing your business for $76,000 to cover medical bills and other related damages. General liability insurance would pay for your legal representation in court, as well as any damages awarded.
Example 2: Your client has asked for help with a technical issue. While their laptop is in your possession, you drop it, damaging it beyond repair. Your general liability policy would help cover the cost to repair the $3,800 laptop.
Example 3: Your new website features a photo that is protected under copyright law. If named in a copyright infringement lawsuit, your general liability insurance would help cover related attorney’s fees and/or a court-ordered judgment.
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, technical writing businesses in America spend between $300-$600 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 Technical Writing Businesses 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 technical writing businesses should obtain:
Professional Liability Insurance
Lawsuits stemming from your work, including failure to deliver promised services, oversights and mistakes, and professional negligence, are specifically excluded without a professional liability insurance policy. Also known as Errors and Omissions (E & O) insurance, this policy helps reduce the potential for coverage gaps, covering resulting legal costs and court-awarded damages.
Home-based business insurance
Business property and business-related losses are specifically excluded on most standard homeowners insurance policies. To ensure proper coverage, a home-based business insurance policy may be necessary to protect your property in the case of damage or loss to commercial property in a covered event.
Types Of Coverage Some Technical Writing Businesses May Need
In addition to the policies outlined above, there are a few other types of coverage your technical writing business 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 Property Insurance
If you choose to work outside the home, a commercial property policy may be a necessary part of your insurance portfolio. This policy covers the cost to repair and/or replace damaged property, including owned real estate and business-owned property, should a covered loss occur on your business premises.
Data Breach Insurance (aka Cyber Attack insurance)
Your profession requires you to work with technology regularly. Unfortunately, this can make you a target for online hackers, an loss that is specifically excluded on a general liability insurance policy. Data breach insurance helps fill that coverage gap, paying damages from a data breach that results in stolen user data.
Workers’ Compensation Insurance
Once your business has grown enough to hire a team, you will be required by the state to carry workers’ compensation insurance. This policy covers an employee if they are injured or fall ill while on the job. In addition to their medical bills, it can cover lost wages and legal representation for the business owner, if a lawsuit is filed.
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.