What is Public Liability Insurance, and Why Do I Need It?
What is Public liability insurance and why do I need it? Public liability insurance is the insurance that covers any risk of liability that a business may have to pay to a customer if the customer suffers an injury while on the premises. PLI also covers the risk if the business causes damage to a customers property. Public liability insurance will also reimburse the owner for legal charges while defending the business as a result of claims. This coverage of insurance is especially important because if a court does not award any damages, the business owner will still have to pay large legal fees as a result of the claims.
Public liability insurance is a necessity for the business because the fact is that no one can run a business that doesn’t carry some type of risk. A small business cannot ignore the risk factors associated with their particular business. It is the business owner’s responsibility to and legal obligation to compensate the customer for any loss to their property as a result of negligence by your business. Sometimes a claim can go as high as or beyond a million dollars. It is important that a business owner purchase insurance because just one claim could cause the business owner to lose their business and depending on the type of company their personal assets as well.
An example of a situation when it would be important for a contractor or carry public liability insurance would be if you and your employees were at a construction site, building a house or office complex. A person passing by steps on a rusty nail, trips on a piece of wood or an employee drops a heavy object on the passer by. The responsibility for payment on any of these claims would be the business owner. These are just a few examples that show how important a public liability insurance policy is to a small business. Any business. The possibilities of causes for claims are endless. The best decision a business owner can make is to purchase insurance and have peace of mind so they can concentrate on build their business.
Employment Practices Liability Insurance
Employment practices liability insurance offers protection to business against claims that their legal rights as employees of the company have been violated. This policy offers the business protection against lawsuits filed by its employees such as sexual harassment, wrongful infliction of emotional distress, failure to employ or promote, breach of employment contract, discrimination of age, sex, race, disability etc., wrongful termination, negligent evaluation, wrongful discipline, deprivation of career opportunity, unfair hiring practice etc.
Policy Overview:
The cost of employment practices liability insurance policy depends on the size and type of your company, number of employees, the risk factors involved, history of the company being sued over employment practices etc. the policy will compensate the company for the costs incurred while defending a law suit in court, its judgement and settlement etc. it usually covers all the legal costs no matter if the company wins or loses the suit. The policy not only covers the employer entity but also its directors, partners, officers etc. Employers should try to obtain the broadest coverage available, making it possible for part-time, temporary, leased, seasonal employees and independent contractors to be covered too. It is common for these policies to offer severability, where an innocent insured will not lose his insurance when another insured acted in such a way as to be excluded from the coverage. The employment practices liability insurance agencies allow the employer to select their own defence counsel. This policy has a draw back as insurance agencies may refuse to pay punitive damage claims! The claim that the employer seeks coverage for must take place with in the period of the policy.
The current trend to sue the employer has resulted in corporate countering them by drafting policies that forbid discrimination and harassment, training personnel to reinforce the policies, making sure that the employees’ complaints are heard and that appropriate action is taken. This is a serious matter as employment disputes make up over 30% of all civil litigations! The current federal and state employment laws have favoured employees, making them seek broader than ever rights of recovery. Therefore the employer will benefit if the policy applies on a per claim basis as, if the business faces a class act lawsuit, it will just have to pay one deductible for the entire claim. The business will benefit if it obtains a cap on the total amount of the deductible to be paid under the Employment practices liability insurance policy.
Make sure you investigate the need for the policy thoroughly, choose a good carrier, are able to choose your attorneys in case of a lawsuit, and maintain control over settlements if any. There are firms that offer their services and products to help run a business smoothly making the work of new entrepreneurs easier.