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 GRAPHIC DESIGN STUDIO

Example 1: Your graphic design studio recently received a large piece of printing equipment for which there was no outlet. While waiting on your electrician to install a new outlet, you decide to use an extension cord to power the machine. As a result, a visitor or client of your studio trips over the extension cord and requires medical attention. Your general liability insurance policy may cover any medical expenses and/or lawsuits related to the trip and fall accident.

Example 2: While trying to promote your graphic design business, you accidentally run an ad that misrepresents your services. A client contacts you, wanting the advertised service, and after you explain that the ad was wrong, they decide to sue you for false advertising. Your policy may help cover the costs associated with the false advertising lawsuit.

Example 3: While walking up your entrance stairs, the handrail fails, sending your client tumbling to the ground. This results in numerous scrapes and the need for emergency medical services. Your general liability insurance policy may help cover the costs associated with the emergency transport and treating the injury.

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, graphic design studios 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:

Graph showing average price of general liability insurance prices per industry

Several factors will determine the price of your policy. These include your:

  • Location
  • Deductible
  • 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.

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Other Types Of Coverage Graphic Design Studios 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 graphic design studios should obtain:

Commercial Property Insurance

If your graphic design studio is located in a commercial building with a physical address, you’ll need commercial property insurance in order to financially protect your building, property, and equipment from certain covered losses.

Commercial Umbrella Insurance

If you anticipate potential large claims or lawsuits, you’ll want to consider purchasing a commercial umbrella insurance policy. These policies cover claim amounts that are more than the limits of your regular general liability insurance policy.

Professional Liability Insurance

Professional liability insurance protects you against lawsuits stemming from errors in your work, omissions, or acts of negligence.

Types Of Coverage Some Graphic Design Studios May Need

In addition to the policies outlined above, there are a few other types of coverage your graphic design studio 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 employ any graphic designers and other employees at your place of business, you’ll need Workers’ Compensation Insurance, which helps pay for the costs associated with any on-the-job injuries.

Cyber Liability Insurance

Cyber liability insurance protects you in the event that an unauthorized person hacks into your databases and steals information about your clients, business, and/or employees.

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.