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 Crematoriums
Example 1: A potential client is touring your crematorium facility when she slips and falls, breaking her knee. She asks that your business pays for her medical treatment because you failed to put up a sign about the wet floor. Your general liability insurance policy will likely cover the costs of treating her injuries if you file a claim.
Example 2: One of your employees is hauling a hand cart full of supplies from the delivery truck to the crematorium when he loses his footing and lets go of the cart. The heavily loaded cart careens into the luxury car of a customer currently in your place of business, causing considerable damage to the vehicle. Your general liability insurance policy would likely cover the cost of fixing the customer’s vehicle.
Example 3: You have decided to purchase a new logo for your crematorium business. Once you begin using the logo in your marketing materials, you get an email from the attorney of your competitor. The attorney writes that the competitor is suing your business because the logo is too similar to his own. The general liability insurance policy that you have will pay for your legal defense. Should you need to settle the case outside of court, your general liability insurance will pay for the settlement as well.
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 crematorium in America spends between $450-$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 CREMATORIUMS 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 crematoriums should obtain:
Workers’ Compensation Insurance
Most states require employers to have workers’ comp insurance. Since you have employees helping you operate your business, it is important to carry a workers’ comp policy. Your policy has multiple benefits. It will pay for the medical treatment of work-related injuries for your employees, so they can recover and come back to work. It will also help to cover the cost of lost wages for employees who are forced to stay home due to their injuries.
Commercial Property Insurance
The equipment you have purchased to make your business operational—like your furnaces—was costly and would be expensive to replace were it to be ruined by a disaster. In the case of something like a fire, commercial property insurance would provide the protection you need for your commercial equipment. With commercial property insurance, you could file a claim and get help with purchasing new equipment for your business. The support of your policy would make it much easier to get your business back up and running.
TYPES OF COVERAGE SOME CREMATORIUMS MAY NEED
In addition to the policies outlined above, there are a few other types of coverage your crematorium 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
Every general liability insurance policy has limits. Once those limits are exceeded, the policy stops paying—which means that you are left paying for anything beyond those limits. Sometimes situations occur where your general liability insurance policy will not be enough to pay for everything. This can happen when your business loses an expensive lawsuit, for instance. But with a commercial umbrella insurance policy, you will have added protection. The umbrella policy will pick up where the general liability policy leaves off.
Commercial Auto Insurance
If you have an automobile that is used primarily for your crematorium business, then you need to make sure that it is covered by a commercial auto policy. With commercial auto coverage, you, your employees and your vehicle have protection. Should you or your employees be in an accident in the vehicle, your policy will help pay for repair or replacement costs and medical treatment for those involved in the accident. State law requires you to carry commercial auto insurance as well.
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.