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 PERSONAL CONCIERGE
Example 1: A client has stopped by your office to pick up their shopping because they are running short on time and can’t wait for delivery. As an employee brings their bags to load into the car, they lose control of the cart they were using and send it crashing into the luxury vehicle. The impact causes extensive damage to the car and to the shopping items. General liability insurance will likely cover the cost of the damage.
Example 2: You’re conducting client interviews at your offices when a potential new client trips over your laptop power cord, breaking their wrist in the fall. General liability insurance will likely pay for their medical bills and any potential legal fees.
Example 3: You’ve decided to redesign your logo, and about a month after putting up your new sign in the parking lot, your lawyer receives a call from a local rival firm. They have accused you of copyright infringement and are threatening to sue. General liability insurance will likely cover your legal fees and any payout if a settlement is reached.
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, personal concierges in America spend between $400 - $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.
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 personal concierges should obtain:
Professional Liability Insurance
If a client says that you’ve failed to properly complete an important task after charging them for your services, you could potentially face a lawsuit. Professional liability insurance, also known as errors and omissions insurance, will work to protect your business in this type of situation and cover any resulting legal fees.
Commercial Auto Insurance
Your personal car insurance won’t provide protection if you’re involved in an accident while performing work duties. This means that whether or not you use personal or company cars, you need to invest in commercial auto insurance to protect your vehicles and anyone driving them in the event of an accident.
In addition to the policies outlined above, there are a few other types of coverage your personal concierge 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 provide workers’ compensation insurance for their employees. If they become injured on the job or fall ill due to a work-related incident, this insurance policy will cover their medical bills. Additionally, if they are unable to return to their job, workers’ compensation will provide disability benefits.
Data Breach Insurance
Your clients entrust you with some of their private information in order to complete different tasks for them. But if your computer system is breached, all of that personal and financial information could easily be stolen by cyber attackers. Data breach insurance can protect your business from related legal costs.
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.