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 WHITEWATER RAFTING BUSINESS
Example 1: A client is making their way down to the raft launching area when she slips and falls on the rocks below, she breaks several bones in the fall and needs ambulance transport to the hospital. She demands that your business is responsible for her injuries and wants you to pay for her medical costs. Your general liability policy will likely cover her medical bills if you file a claim.
Example 2: An employee is carting some rafting equipment from your shop to the storage facility on-site when he loses control of the hand cart. The cart tumbles downhill and hits a visitor, knocking her down, and she hits her head on the rocky ground. She decides that she wants to take legal action against your business and is seeking damages. Your general liability policy will likely cover the cost of your legal defense, helping you to hire an attorney and pay out any settlements.
Example 3: A competing white water rafting company on the river has decided that your logo is taken directly from theirs and informs you that they’re taking legal action against your company. Your general liability policy will likely cover the cost of your associated legal fees. If you are required to settle with your competitor over the logo design, your policy should cover the damages as well.
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, whitewater rafting businesses in America spend between $400 - $1,100 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 whitewater rafting 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 whitewater rafting businesses should obtain:
Workers’ Compensation Insurance
It’s likely that all of your part-time and full-time employees need to be covered by workers’ compensation insurance to meet state requirements. This vital coverage option works to protect your employees and your business. If an employee is injured on the job or becomes ill after performing job-related duties, workers’ compensation will pay for their medical care and help to cover lost wages while they recover.
Commercial Property Insurance
The costs associated with establishing a white water rafting company are substantial. If you lose your specialized equipment and supplies in a fire or accident, it can be difficult to replace everything and keep your business running. Commercial property insurance can help to protect against losses from fires and other disasters. If your commercial property is damaged or lost due to a covered event, you can file a claim and get the money you need to keep the business afloat.
Types of Coverage Some whitewater rafting businesses May Need
In addition to the policies outlined above, there are a few other types of coverage your whitewater rafting 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 Auto Insurance
If your white water rafting company relies on personal and business vehicles, you need to invest in commercial auto insurance. This type of policy is designed to protect your business in several ways. If you or an employee is in an accident, it will cover the cost of fixing or replacing any damaged vehicles. Additionally, your policy will cover medical care for anyone injured in the crash, along with additional damages if your employee is found to be liable.
Commercial Umbrella Insurance
Your primary business insurance policy will protect your company in most legal situations. However, there may come a time when those policy limits are exceeded in a large lawsuit. To prevent paying the difference out-of-pocket, you can purchase additional protection through a commercial umbrella policy. The additional coverage will pick up where your general liability policy leaves off and pay for any remaining damages.
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.