How to Protect Your Small Business from Legal Claims

A lawsuit can hit your business at almost any time. Yes, many may be frivolous. You may even be able to argue it out of court. The problem is that it doesn’t matter if you would win; being hit with a lawsuit will immediately disrupt your business operations and comes at a huge cost. Even in the “best case scenario”, where you win a lawsuit against you, you’ll still have to pay exorbitant lawyer’s fees. You can’t even rest easy knowing that the plaintiff also has that cost since many personal injury lawyers operate on a no-win, no-fee basis. 

In short, a lawsuit can break your business and even bankrupt it. This is not something you can risk, especially if you’re just getting on your feet. Thankfully, there’s a simple but effective solution: liability insurance. 

So long as you do your utmost to provide a safe product, store, office, or service, and there’s no evidence of negligence, then you’ll be covered. Negligence can include things like not taping off a broken tile in your store or not icing the front of your store. So long as you take precautions and work to make your space or service as healthy and safe as possible, you’ll be golden. 

Not all liability insurance options, however, are for everyone. There are three main types, so to help you understand what type you need to protect your small business from insurance claims, you’ll want to use this guide: 

General Liability

If you operate a store, office, or any other space where others enter, regardless of whether those people are members of the public, customers, clients, workers, or even your own family members, you’re going to want general liability insurance, and might check out something like this Hiscox Review to learn about as many of your options as possible. If someone slips and falls, has something fall on them, or a myriad of other accidents occur, you could end up slapped with a personal injury lawsuit. General liability insurance protects you financially in this case and also helps you keep things up and running by handling the case and claim. Going to reputable small business insurance brokers to find the best liability insurance coverage for your business can give you peace of mind and can also protect you from financial fallout.

Product Liability

Product liability works to cover similar issues, only this time, it’s geared around products. This type of insurance is essential for manufacturers and other production companies. A faulty product, lack of labeling, or a mislabeled product can all result in customer injury. Depending on how much the fault of the injury falls on your product design, the compensation costs can skyrocket. Getting product liability insurance helps protect you financially from such a fallout. 

Professional Liability

Your services can also cause injury or damage. If you’re a landscaper, for example, and somehow a tree you’re cutting down hits a shed or other part of the property it wasn’t supposed to, then you are liable for those damages. Professional liability insurance helps you weather the costs associated with those sorts of compensation claims.