All owners need business insurance to cover liability. Even in very careful situations, there is still the risk of someone who may get injured or suffer a loss.
However, companies can be proactive. Reducing this risk means understanding what your obligations are. Ultimately, this comes down to determining if you breached a legal duty to a person.
When Are You Responsible?
Liability occurs when you fail another person in some way. It is not always clear when this can occur. According to the Insurance Information Institute, your legal duty to another person is the deciding factor. Some examples of liabilities include:
- You slandered another person or business.
- You did not keep a safe environment that was accessible to the public.
- You failed to investigate a claim of discrimination or harassment.
- A product was not safe.
- Your communication about a product or service misled another person.
These are just a few examples. Many others exist. Understanding this obligation is important. Ultimately, this defines your responsibility.
How Can You Avoid These Situations?
Business insurance helps protect you from these financial losses. However, businesses need to take other steps to minimize liability risk. Here are a few examples:
Create a Safe Location: Make public areas as safe as possible. Mark exit signs clearly. Provide ample lighting. Ensure stairs have handrails. Keep floors dry and clear. Clean up any mess as soon as possible.
Employee-related Risks: Provide adequate training for employees. Investigate any incident reported to you. Work with a local employment attorney. Ensure your rules are within the letter of the law. Meet all Equal Employment Opportunity Commission rules.
Product Liability Risks: Keep records of all manufacturing and sales. Inspect your products carefully. Keep records of temperatures and conditions prior to sale. Provide proper warnings for products. Gather as much information as possible if a claim occurs. Identify products thoroughly.
It also helps to stay up to date on the industry. Monitor your competitors. A lawsuit against one provider may impact another. Discuss all of the risks with your business insurance agent as well. You need to have a comprehensive policy. Rely on your agent to help you pinpoint key concerns.
Always react to concerns as soon as possible. By providing a quality product and a safe environment, you are doing the right thing for your customers and visitors. However, having the right business insurance also matters.
Need liability coverage? Call Guardian Insurance at (770) 277.4779 or 855.554.6482 right now. We can help you get a fast, free quote on an affordable policy.
Also check out - Liability Insurance for Small Business and 5 Tips for Buying Business Insurance