Insurance that protects a company and/or business owner in the event of a formal lawsuit or other third-party claim. Coverage includes any financial liability incurred in addition to expenses related to the company’s legal defense. There are three main types of business liability insurance: general liability insurance, professional liability insurance and product liability insurance.
General liability insurance coverage for an insured when negligent acts and/or omissions result in bodily injury and/or property damage on the premises of a business, when someone is injured as the result of using the product manufactured or distributed by a business, or when someone is injured in the general operation of a business.
Product liability insurance protects the business from claims related to the manufacture or sale of products, food, medicines or other goods to the public. It covers the manufacturer’s or seller’s liability for losses or injuries to a buyer, user or bystander caused by a defect or malfunction of the product, and, in some instances, a defective design or a failure to warn. When it is part of a commercial general liability policy, the coverage is sometimes called products-completed operations insurance.