How Does Commercial Insurance Work In The Case Of Liability?
It's a well known fact that if you're starting a business you're going to need insurance. But what does this actually mean? What what type of protection does this offer you? How should you decide what kind of coverage you need? If you are in need, commercial insurance Ontario has a lot to offer
, but you should first figure out how it works.
What is Liability Insurance?
Liability insurance protects assets and pays for your obligations such as medical costs if someone gets hurt while on your property or even when there's property damage caused by employees. Liability insurance covers the costs of legal defense and settlements if you lose in a lawsuit. This type of insurance protects you against liability as a tenant if you happen to cause damage to property that you're renting.
Determining What You Need
The coverage you will need will depend on the type of company you own as well as the perceived risks that are associated with it. For example, building contractors will need more coverage than web designers. Your location is also a factor. Certain locations award more in damages to plaintiffs who claim personal injury than the others.
How Liability Insurance Works
As with many plans, your liability policy will outline the max amount the insurance company is willing to pay against a claim. So, if your business gets sued for $200,000 for the medical costs that are associated with an injury caused by worksite hazards, plus an additional $50,000 in legal fees, but your coverage maxes out at $225,000, then you are expected to pay the difference of $25,000. If you're on the higher end of the company's risk scale and already have liability insurance, you may also purchase excess insurance so that it will increase your coverage limit.
Filing a Claim
If an incident happens to occurs that leads to a claim, then you should immediately notify your insurance company or one of their agent
. You need to be prepared to explain what happened. Make sure to fill them in on all details including the date, time as well as the names of all witnesses.
Is There Any Other Commercial Insurance I Need?
Besides liability insurance, you may be required to pay workers’ compensation insurance as well as disability insurance. This will depend on your specific location. Also, depending on what type of business you own, you may need auto insurance, alcohol liability insurance, home business insurance, environmental insurance, product liability insurance and more.
If you're interested in protecting your assets, then it's important that you're very familiar with insurance practices. You need to know what type of coverage is best for your business
and how much you will be covered for in the event of an incident. Also make sure to do your industry research before you decide to invest in a policy. Sometimes client contracts will require that your company has the appropriate coverage in order to do work form them. And in some cases, as those in construction, you may be add to the other company's liability policy until you finish the job. So make sure to read the fine print.