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 LAND SURVEYING BUSINESS
Example 1: Your employee didn’t secure the area after completing a job and a trespasser gets injured. If they name you in a lawsuit, general liability insurance would cover associated legal fees and awarded damages.
Example 2: A small hole isn’t filled in at the end of a survey job. Your client steps in the hole and has incurred significant medical bills. A general liability policy should cover his medical expenses.
Example 3: Your new website includes a photo protected under copyright law. The owner of the photo names your business in a lawsuit. General liability insurance should cover your legal fees and damages awarded by the court in a copyright infringement lawsuit.
Example 4: You applied for a loan to purchase more business equipment and the bank requires evidence of liability insurance as part of the loan agreement. A general liability policy could help fulfill this obligation.
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.
On average, land surveying businesses in America spend between $500 - $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.
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 land surveying businesses should obtain:
Commercial Auto Insurance
If an auto accident involves you or a team member doing business-related activities, commercial auto insurance will cover the cost to repair or replace damaged property. It will also cover medical expenses, liability claims, and lost equipment. To protect your surveying business from suffering financial loss due to this claim, business owners should consider purchasing limits higher than the state-mandated minimum requirement.
You can purchase commercial auto insurance as a standalone policy or as part of a business owner’s policy (BOP), depending upon the carrier.
Commercial Property Insurance
Whether you own or rent the building your business operates out of, you should have a commercial property insurance policy. When a loss, such as fire, theft, or windstorm, occurs, this policy pays to repair and/or replace business-owned property. Owners should consider coverage limits alongside the cost to replace everything should a total loss occur.
You can purchase commercial property insurance as part of a business owner’s policy (BOP).
Inland Marine Insurance
In this profession, business tools are often used away from the company’s premises, leaving you uninsured or underinsured if a loss occurs. An inland marine policy will pay for losses while in transit or at a customer’s property. This can fill the coverage gap left by a standard commercial property insurance policy.
In addition to the policies outlined above, there are a few other types of coverage your land surveying business 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.
Professional Liability Insurance
If a customer files a lawsuit against your company, citing harm due to your professional negligence, regardless of the claim’s merit, they could take you to court for damages. This policy, also known as Errors and Omissions (E & O) insurance, ensures coverage of your legal fees and awarded damages up to the limits of your policy.
Workers Compensation Insurance
Workers compensation helps protect your business’ most valued assets - the employees. This state-mandated insurance policy covers the medical bills of employees who get injured or fall ill while on the job. If the injury is serious and the worker must take time off of work, it would reimburse them for part of their lost wages. In the event of a lawsuit, it would cover the business owner’s legal fees.
You can purchase workers compensation insurance as a standalone policy.
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.
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.