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 BOUNTY HUNTER
Example 1: One of your employees accidentally knocks a pedestrian down while in pursuit of someone. The pedestrian sues for repayment of his medical bills as well as damages from pain and suffering. General liability insurance should cover your legal fees and any damages awarded in a settlement (up to the limits of your policy).
Example 2: One of your bounties sues your company, citing misuse of force and improper use of handcuffs. General liability insurance would cover your legal fees as well as any damages awarded in a settlement.
Example 3: A bounty names your business and the county in a lawsuit, citing false arrest and slander. General liability insurance should cover any related legal fees and awarded damages.
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, bounty hunters in America spend 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.
How much will the right insurance cost you?
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Other Types Of Coverage Bounty Hunters 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 bounty hunters should obtain:
Data Breach Insurance
As a bounty hunter, you store sensitive information regarding each of your bounties. If a hacker attacks your computer system and steals any of your data, you could face a lawsuit. Data breach insurance covers fees and damages associated with these situations — a coverage often excluded in general liability policies.
Professional Liability Insurance
Professional liability insurance protects your business if you or your employees make an error that results in a financial loss and/or lawsuit. Given the significant liability risks in this line of work, business owners should address any potential coverage gaps with their insurance professional. Be sure to ask if your policy is claims-based or occurrence-based as well as if it includes coverage for fugitive recovery, wrongful entry, wrongful seizure, abuse and molestation claims, and incidents involving concealed weapons.
Workers’ Compensation Insurance
You and your staff regularly encounter dangerous situations in pursuit of criminals, which sometimes result in on-the-job injuries. Workers’ compensation insurance, required by most states, 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 or death benefits stemming from a work-related accident.
Bounty hunter business owners should consider carrying coverage above and beyond the legal minimum requirements, and you typically can purchase this as a standalone policy.
Types Of Coverage Some Bounty Hunters May Need
In addition to the policies outlined above, there are a few other types of coverage your bounty hunter 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 Auto Insurance
Any vehicle you use primarily for business requires commercial auto insurance to protect the vehicle, driver, and others on the road in the event of an accident. While most states regulate the minimum coverage required, this often leaves business owners exposed to potential lawsuits. Therefore, consider seeking the assistance of an insurance professional to help you determine the appropriate coverage limits for your business.
You can purchase commercial auto insurance as part of a business owners policy (BOP) or as a standalone policy.
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.
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.