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.
COMMON SITUATIONS THAT GENERAL LIABILITY INSURANCE WOULD COVER FOR A WINDOW TINTING BUSINESS
Example 1: While moving a customer’s vehicle from the service bay to the parking lot, one of your technicians causes damage to a parked vehicle. General liability insurance should cover the damage to the parked vehicle. The customer’s vehicle would be covered under a different insurance policy.
Example 2: One of your social media posts mentions how many customers of XYZ Tinting have started using your services after their tinting from XYZ started peeling. XYZ Tinting is suing your business for compensatory damages, claiming they lost customers as a result of your ad. This advertising injury claim would be covered under your general liability policy.
Example 3: A customer is brought into the workshop so they can see an issue the technician has run into. While walking through, the technician drops a tool on the customer’s foot. General liability insurance would likely cover the cost of treating their injuries.
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
The average window tinting businesses in America spends between $450-$1000 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.
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OTHER TYPES OF COVERAGE WINDOW TINTING 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 window tinting businesses should obtain:
Commercial Property Insurance
If you own the building you run your window tinting business out of, you should consider purchasing commercial property insurance. This would cover the brick and mortar structure as well as the business property kept on site.
When considering your coverage amount, it’s important to include any build-outs done to the building and any specialized tools purchased for the business. You should purchase enough coverage to replace all equipment/tools and to rebuild the building in the event of a loss.
This coverage is frequently available as part of a business owner’s policy (BOP).
Workers’ Compensation Insurance
If your window tinting business has employees, the business is likely required by state law to carry workers’ compensation insurance. Workers’ compensation typically covers injuries that employees suffer while on the job.
Workers compensation is generally purchased as a standalone policy.
TYPES OF COVERAGE SOME WINDOW TINTING BUSINESSES MAY NEED
In addition to the policies outlined above, there are a few other types of coverage your window tinting 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.
Business Interruption Insurance
If you depend upon the business’s revenue to support your household, consider purchasing business interruption insurance. If a major event occurs that forces the business to shut down for an extended period of time, this coverage will help make up some of the lost revenue.
Business interruption insurance is typically available as part of a business owner's policy (BOP).
Commercial Umbrella Liability Insurance
Working around and on automobiles puts you at greater risk than other types of businesses, with liability expenses often exceeding the limits of primary policies. Commercial umbrella liability insurance adds an extra layer of liability coverage, protecting you against sizable covered lawsuits.
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.