Matt Hands, VP, Insurance and MoneySense
Commercial general liability, also known as CGL insurance, is a type of business insurance that protects you from third-party claims of bodily injury and property damage as a result of your day-to-day operations.
Reducing risk is key to keeping your business running. So whether a customer slips and injures themselves in your restaurant or your employee damages a client’s floor during a construction job, having a CGL policy will protect you financially by covering any legal fees, medical expenses, and compensatory damages.
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Any Canadian business owner should consider purchasing general liability insurance because one mishap can lead to financial hardship. Having general liability insurance will protect you from the cost of legal fees and damages. In some industries, such as construction, clients will require a CGL policy before they hire you. Additionally, landlords of commercial property often require insurance coverage before leasing out their space.
CGL insurance is especially important if:
- Your business is open to the public
- You conduct business on a client’s property
- You work with clients or customers frequently
- You own or lease a property for business operations
Tenant’s legal liability
Personal and advertising injury liability
How much does commercial general liability insurance cost?
Most commercial general liability insurance policies cost about $500 annually for small to medium-sized businesses, but it can vary according to the amount of coverage you want.compare quotes
Although every business comes with risks, some businesses present higher risk levels than others. Generally, the more risk your industry brings, the more expensive your quote will be. With higher risk comes a higher likelihood of a claim. So if you work in construction, expect to pay higher premiums than someone who works in an office, as the possibility of property damage or bodily injury is much higher.
General liability insurance not only protects you financially from claims or property damage and bodily injury, but it can help sustain your reputation if a third party decides to sue. Lawsuits can destroy the trust between you and your clients, but having an insurance policy can lead to fast settlements and get your business back to normal. A CGL certificate is also often a requirement at different venues (eg. hotels, arenas, conference halls) for events, such as tradeshows, weddings, or conferences.
Some possible general liability claims you could face include:
- Slip and fall accidents in a store, restaurant, or office
- Vehicle damage in a repair shop
- Food poisoning in a restaurant
- Fire damage in a commercially leased space
- Reputational harm of a competitor on social media
- Copyright infringement of an unlicensed photo on social media
Uphold safety standards
It’s important to follow all the safety standards in your industry to reduce your risk of being liable for bodily injury or property damage. Always use the proper equipment and products in your line of work, and keep the working environment clean to avoid fire or slip and fall accidents. If a third party files a claim against you, and you haven’t been following regulated safety standards, it could cost more.
Handle customer property with care
If you run a repair business, make sure to handle your client’s property with caution and follow proper procedures. For example, if you repair computers, it’s always a good idea to document the condition of the device before you start working to reduce any invalid claims. Be sure to also have a proper system for storing your customer’s items, especially if they’re valuable or contain sensitive information.
Watch your marketing
As a small business owner, it’s also important to watch what you say or post about your clients or competitors. Speaking poorly about others in person or online could result in a lawsuit for slander or libel. Also, make sure you aren’t infringing someone else’s copyright by only using licensed content for your business.
Train your employees
Ensure your employees understand the standards of your business, including how they might represent your business online or with their words. Equip them with the right knowledge and the why to create a safe environment for others and handle your clients’ property with care to reduce the possibility of a general liability claim.
What doesn’t commercial general liability cover?
What’s the difference between general liability insurance and professional liability insurance?
Is commercial general liability insurance mandatory to have?
How do I get commercial general liability insurance in Canada?
Matt Hands, Business Director of Insurance
With 6+ years of experience at Ratehub.ca, Matt’s focus has been on growing its newest business unit, Insurance. He is a thought leader and a valuable resource to respected publications across Canada. read full bio
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