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 A CAMPGROUNDY
Example 1: If a visitor to your campground is injured due to poor maintenance or upkeep surrounding a fire pit and/or grill, you could be held liable for their injuries. General liability insurance would likely cover their injuries in a lawsuit.
Example 2: A camper takes their boat out on the water using the boat launch provided. But the boat launch wasn’t properly repositioned in the spring, and it damages their boat. General liability insurance will likely help to pay for the repairs.
Example 3: Many modern campgrounds feature supply shops and general stores for visitors to restock their supplies during their stay. If a camper slips and falls on a freshly cleaned floor, your general liability coverage would likely help to pay for their injuries.
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 campground in America spends between $450-$1,500 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 CAMPGROUNDS 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 campgrounds should obtain:
Commercial Auto Insurance
All of the vehicles that are used in relation to your business must be covered under a commercial auto insurance policy. Personal insurance will not pay for any damages if you are involved in an accident while operating your business vehicle.
Workers’ Compensation Insurance
If one of your employees suffers an injury or becomes ill due to work-related duties, workers’ compensation coverage will cover their medical treatment and any other relative expenses. Most states require this type of coverage for both part-time and full-time employees.
TYPES OF COVERAGE SOME CAMPGROUNDS MAY NEED
In addition to the policies outlined above, there are a few other types of coverage your campgrounds 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.
Data Breach Insurance
When visitors register at your campground, they are trusting you with their personal and private information that may include their home address, credit card numbers, bank account information, and more. With the help of this important insurance coverage, you can help to protect your business and customers in the event of a computer breach that results in stolen data.
Commercial Umbrella Liability Insurance
This specialized insurance coverage is designed to kick in when your other primary policies have been exhausted. So if you end up facing a lawsuit that has already gone beyond the limits of your other insurance coverage, commercial umbrella liability insurance works to cover the remaining costs and damages.
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.