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 INTERNATIONAL FOOD STORE

Example 1:  When a customer spills soda and fails to tell anyone, another patron slips on the wet floor and injures herself in the resulting fall. Her injuries require surgery and a long hospital stay. General liability insurance would cover her medical costs and your legal fees in the event of a lawsuit.

Example 2:  After a new competitor moves into your neighborhood, you distribute flyers with coupons and information explaining why your store is the best. The competitor files a lawsuit against you, claiming your actions cost him a significant amount of business. General liability insurance would cover your legal defense and any court-awarded damages.

Example 3:  In an effort to gain more exposure, you apply to participate in a local farmer’s market. The market requires all vendors to provide evidence of liability insurance, which your general liability policy would fulfill.

Example 4:  While delivering food to a customer, an employee backs into the customer’s motorcycle and severely damages the bike. General liability insurance would pay to repair or replace the customer’s damaged property.

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, international food stores in America spend between $500 - $1,200 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 International Food Stores 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 international food stores should obtain:

Product Liability Insurance

Product liability insurance offers protection to businesses that manufacture, supply, or sell products — including food. If a patron names your business in a lawsuit because they claim they became ill due to a product you sell, product liability insurance would cover your legal fees and any required settlement. 

 

You can typically purchase this coverage as part of a business owners policy (BOP).

Commercial Property Insurance

You made a major investment in the real estate, inventory, and equipment necessary to establish your store. In the event of a fire, theft, or natural disaster, commercial property insurance would cover the cost of repairing or replacing your business-related property. This includes structural damage to your building as well as the inventory and other business materials stored there.

You can typically purchase commercial property insurance as part of a business owners policy (BOP).

Types Of Coverage Some International Food Stores May Need

In addition to the policies outlined above, there are a few other types of coverage your international food store 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

Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. This coverage 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 workplace accident. For extensive injuries resulting in lawsuits, this type of policy also covers a business owner’s legal defense costs.  

 

Most insurers offer workers’ compensation insurance as a standalone policy.

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. Be sure to select a policy that covers not only accident-related vehicle repair costs and medical treatment for anyone injured, but also sufficient protection for any business property you carry in your vehicle. Also consider a policy with limits that exceed the state-mandated minimum coverage.

 

You can purchase commercial auto insurance as part of a business owners policy (BOP) or as a standalone policy, depending upon the insurer.

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.