Small Business Owners & Public Liability Insurance

Although it's a tool that can save a company from financial ruin and protect the owner of a company in a number of ways, most business owners don't know everything they should about public liability insurance. Having public liability insurance protects yourself, your business and your employees from claims of negligence that may be filed against you. Third-party negligence suits come in all shapes and sizes, and can run the board from a customer claiming he was injured while on your property to someone claiming a product your company manufactured caused her child to have cancer. These cases are often high-value, and those without this insurance find themselves in severe financial distress while trying to fight these lawsuits in court.

In many instances, small business owners neglect to have the proper public liability insurance, due to the exorbitantly high premiums often associated with the policy. In some cases, business owners make a seemingly educated decision, deeming their business sufficiently low-risk to forgo the coverage. The truth is, no business entity is low-risk, and virtually anyone can find himself on the wrong end of a liability lawsuit. While many large companies and most huge corporations have the legal and financial assets required to fight a protracted court battle, small business owners do not, and are the ones needing the most assistance from public liability insurance. Owners of small businesses are most likely to settle the case, even believing they are not at fault, in order to avoid the cost of a lengthy legal proceeding and any negative publicity that may arise as a result of a lawsuit.

Many states require business owners to carry proper public liability insurance, particularly if the company is a participant in what's considered a high-risk industry. Drivers, contractors, manufacturers, and service providers should all have adequate public liability insurance. Those whose livelihood is based upon interaction with a large number of people---such as owners of nightclubs, bars, restaurants, hotels, stadiums, and campgrounds---should not open for business without first having the best liability insurance they're able to afford.

When shopping around for public liability insurance, it's important to have all the relevant information you'll need to receive a fair and accurate quote. You'll be asked about your occupation and the type of goods or services your business provides. You'll also need to provide a list of your employees, the amount of industry experience each of the principals or partners in the business has under his belt, and the date your company first began operation. It's also helpful to have a good idea of the level of indemnity you'll need, often up to five million dollars in coverage.

Having up-to-date and comprehensive public liability insurance is not only a good way to save your business, but also yourself, your home, and your family, from the high price of a liability lawsuit. Even the most cautious business owners are not immune to these legal issues, and a high premium is a small price to pay for knowing you're covered.