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 WATER REFILLING BUSINESS
Example 1: When lugging one of the jugs of water to your client’s door, some water spills on the floor. An employee slips on the water and injures their leg. General liability insurance would cover the costs of their medical injuries.
Example 2: You unload one of the jugs from the back of the truck and it accidentally hits the car of an office employee. General liability insurance would cover any damage to the vehicle.
Example 3: Your water refilling business is attacked by a customer who believes your water made them ill. General liability insurance would help cover the costs associated with protecting your reputation, such as social media campaigns or formal requests to cease and desist.
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, water refilling businesses 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:
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 water refilling businesses 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 water refilling businesses should obtain:
Commercial Property Insurance
If you own the space in which you store your water and run your business, then commercial liability insurance is available in case the physical structure or inventory is damaged by criminal activity, fire, or severe weather.
Product Liability Insurance
Your water or its containers may become contaminated. Product liability insurance is available if any of the products you sell or offer are unsafe in any way. A contaminated bottle of water can cause illness across a wide range of people, and this insurance can specifically target those costs.
Workers’ Compensation Insurance
If you have any employees working for your water refilling company, then workers compensation insurance will cover injuries they sustain on the job. This insurance covers sudden accidents as well as long-term problems that may stem from carrying large water jugs throughout the workday.
Commercial Auto Insurance
If you use your vehicle to transport water, commercial auto insurance is available to cover any damage to the vehicle or its business-related contents. It will also cover standard property damage and bodily injury caused by an accident if you or one of your employees is found liable.
Types of Coverage Some water refilling businesses May Need
In addition to the policies outlined above, there are a few other types of coverage your water refilling 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.
Commercial Umbrella Liability Insurance
This insurance is available in case you exhaust the maximum limits of your general liability policy. A general liability policy may only cover a portion of the legal expenses in a serious claim. This insurance continues to provide funds to fight or settle outstanding legal matters.
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.