What Does General Liability Insurance Actually Cover for Small Businesses
Key Takeaway
General liability insurance protects small businesses from costly claims involving bodily injury, property damage, and personal or advertising injury. It’s one of the most important forms of commercial insurance and often the first policy new business owners should consider.
Why General Liability Insurance Is Essential
Running a business means interacting with customers, vendors, and the public. No matter how careful you are, accidents can happen. General liability insurance helps cover the unexpected—so one mistake doesn’t turn into a financial disaster.
Without it, your business could be responsible for medical bills, legal costs, or property repairs out of pocket.
What General Liability Insurance Typically Covers
1. Bodily Injury to Others
If someone is hurt on your business property or because of your operations, general liability helps cover:
Medical expenses
Ambulance fees
Legal defense if you’re sued
Settlements or court judgments
Example: A customer slips on a wet floor at your storefront and breaks their arm. General liability helps pay for their treatment and protects your business from a lawsuit.
2. Property Damage Caused to Others
If your business activities cause damage to someone else’s property, this coverage helps pay for repairs or replacement.
Example: A contractor accidentally damages a client’s kitchen floor while doing renovations. General liability can cover the cost of repair.
3. Personal and Advertising Injury
This protects your business from claims of:
Libel or slander
Copyright infringement in ads or content
Misuse of a competitor’s brand in your marketing
Example: A local competitor claims your advertising falsely accuses them of poor service. General liability may cover your legal defense and settlement costs.
4. Legal Fees and Court Costs
If your business is sued, general liability insurance helps pay for:
Attorney fees
Court costs
Settlements
Judgments
This coverage ensures you don’t drain your savings or business funds trying to defend yourself in court.
What General Liability Insurance Does Not Cover
It’s important to know what this policy doesn’t include. For complete protection, you may need additional policies such as:
Workers’ compensation – for employee injuries
Professional liability – for errors in professional services
Commercial auto – for vehicles used in business
Commercial property – for your building or inventory
Cyber liability – for data breaches or hacks
An agent at Andrade Mejia Insurance Agency can help bundle the right policies for your business type and risk profile.
Who Needs General Liability Insurance
Most businesses should carry general liability coverage, including:
Retail stores
Contractors and home service pros
Restaurants and cafés
Consultants and freelancers
Event planners and vendors
Health and wellness providers
Even if you work from home or are a sole proprietor, you could still face liability risks. Many landlords, lenders, or clients also require proof of coverage before signing contracts or leases.
How Much Coverage Do You Need
Standard policies start at $1 million per occurrence and $2 million aggregate. Your ideal coverage depends on:
Business size and revenue
Industry risk level
Amount of foot traffic or public interaction
Contract or lease requirements
Let the team at Andrade Mejia Insurance Agency guide you through selecting the right limits based on your business and budget.
Final Thoughts
General liability insurance is not just a safety net—it’s a smart investment in your business’s long-term security. A single accident, lawsuit, or claim could cost thousands without the right protection.
Protect your business from the unexpected. Reach out to Andrade Mejia Insurance Agency to get a personalized quote and policy built for the way you do business.