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.
COMMON SITUATIONS THAT GENERAL LIABILITY INSURANCE WOULD COVER FOR AN ATM BUSINESS
Example 1: As you are removing an old ATM and replacing it with a new one, you lose control of the dolly and drop the ATM on the liquor shelves at a convenience store. The general liability policy would likely cover the replacement cost for the owner’s property.
Example 2: An ATM malfunctions and the person using the machine reaches into the cash dispenser to try and get his money. His hand gets stuck and he sustains an injury. The general liability insurance would likely cover the cost of treating the injury.
Example 3: Many of the property owners where you place ATMs may require you to carry general liability insurance before they will work with you. Having a policy will ensure that you can meet these requirements and serve as many locations as possible.
Example 4: A frustrated ATM user decides to shake a machine and tilts it over on himself. He sustains injuries and takes legal action against your company to cover the cost of those injuries. A general liability insurance policy will likely cover the costs of defending your business and paying for damages if the court decides against you.
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
The average ATM business in America spends between $400-$700 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 ATM 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 ATM businesses should obtain:
Commercial Auto Insurance
Maintaining ATM machines requires you and/or your employees to spend considerable time on the road. All vehicles that are used for business purposes are required to be covered by commercial auto insurance. Your commercial auto insurance policy will help to protect your company vehicles, employees, and others on the road.
Commercial Property Insurance
The tools you use to maintain your ATMs and the facility you keep to store your machines can be expensive to repair or replace—such as in the event of a fire. Commercial property insurance is designed to help you cover the costs of repair and replacement when your commercial property is damaged or destroyed.
TYPES OF COVERAGE SOME ATM BUSINESSES MAY NEED
In addition to the policies outlined above, there are a few other types of coverage your ATM 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.
Workers' Compensation Insurance
If you have any employees helping with your ATM business, workers’ compensation insurance will most likely be required by the laws of your state. When an employee gets hurt on the job and is unable to work, this type of insurance will cover the costs of helping the employee. Workers’ compensation not only helps you adhere to state law, but it also ensures that you do not have to pay expensive medical bills for employees hurt on the job out of pocket.
Your employees may be tempted to act in a criminal manner to take advantage of your ATM business. While you can do your best to hire honest employees and implement proper security measures, you cannot guarantee that you will not be the victim of crime. Crime insurance will likely help to cover some of the costs associated with such crimes, helping you to recover more quickly and get back to doing business.
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) to protect your personal assets. (Refer to our guide for step-by-step instructions on how to form an LLC in your state.)
- Streamline your business’ internal processes. This will remove unnecessary variables from common tasks and create a safe, consistent environment for conducting business.
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.