With a business liability insurance you are insured against the risk of liability if you, your employees, or your products cause damage to others. You may then be liable. And you may have to pay the costs for damage to material belongings, or injuries that someone incurs through your fault.
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For whom is business liability insurance useful?Any business that comes into contact with others can cause damage. And be liable for it. For example, if you knock over a cup of coffee, damaging your customer's laptop. Or if your employee stumbles and breaks a valuable vase at a customer's house. But also if the floor in your shop is slippery and someone slips and breaks a leg. An accident can easily happen, and because the number of liability claims increases every year, it is sensible to take out business liability insurance. More than 90% of companies do this, including freelancers and SMEs.
Is it mandatory?Business liability insurance is not generally required. However, there are many situations in which you do need to take out business liability insurance. A client or supplier can ask for it or your trade or industry association can demand it.
What is usually covered with business liability insurance?
- damage caused by work carried out by you or an employee
- damage caused by your products
- damage to an employee's belongings
- damage to equipment that you rent or borrow
- damage to buildings
Read the policy conditionsWhat is covered and what is not depends on your insurance company. And the conditions of your insurance policy. Always read the policy conditions carefully. You can ask an independent insurance adviser for advice.
What is usually not insured?
- giving the wrong advice. You need professional indemnity insurance for this
- damage to yourself or your business
- damage or costs you incur to redeliver your service or product
- environmental damage on a business premises
- damage caused by intent and recklessness
- damage caused by a motor vehicle, vessel, or drone