Commercial General Liability (CGL)

What Is commercial General Liability ( CGL )

commercial cosmopolitan liability ( CGL ) is a type of policy policy that provides coverage to a clientele for bodily injury, personal injury, and property damage caused by the commercial enterprise ’ mho operations, products, or injuries that occur on the occupation ’ south premises. commercial general liability is considered comprehensive business indemnity, though it does not cover all risks a commercial enterprise may face .

Key Takeaways

  • Commercial general liability (CGL) is a form of comprehensive insurance that offers coverage in case of damage or injury caused by a business’s operations or products, or on its premises. 
  • There are two types of CGL policies—a claims-made policy that covers claims regardless of when the event took place, and an occurrence policy where the event must take place during a set period. 
  • Companies can add other companies or individuals they contract with to their commercial liability insurance policy as an “additional insured.”

Understanding commercial General Liability ( CGL )

commercial general liability policies have different levels of coverage. A policy may include premises coverage, which protects the commercial enterprise from claims that occur on the business ’ s physical location during regular clientele operations. It may besides include coverage for bodily injury and property wrong that is the solution of a finished intersection or service done on another location .

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excess indebtedness coverage can be purchased in holy order to cover claims that exceed the limit of the CGL policy. Some commercial general indebtedness policies may have exclusions to what actions are covered. For model, a policy may not cover the costs associated with a merchandise recall .

When purchasing commercial general indebtedness policy, it is authoritative for the business to differentiate between a claims-made policy and an occurrence policy. A claims-made policy provides coverage for whenever a claim is made, regardless of when the claim consequence happened. An occurrence policy is different in that it covers claims where the claim consequence occurred during the time of the policy tied if the policy is now expired .

In addition to commercial general liability policies, businesses may besides purchase policies that provide coverage for other commercial enterprise risks. For exercise, the business may purchase employment practices indebtedness coverage to protect itself from claims associated with sexual harassment, unlawful ending, and discrimination. It may besides purchase policy to cover errors and omissions made in fiscal report statements, vitamin a well as coverage for damages, resulting from the actions of its directors and officers .

special Considerations

Depending on its clientele needs, a company may need to name other companies or persons as “ extra insure ” under their commercial liability insurance policy. This is common when businesses enter into a contract with another entity. For model, if an automobile repair garage enters into a sign with ABC Co. to provide cleanse services for their adeptness, ABC Co. may require the garage owners to add ABC Co. as “ extra insured ” on their commercial general liability coverage .

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exercise of Commercial General Liability ( CGL )

Some examples that would require CGL include the adopt :

  • A customer enters your place of business where the floors have recently been cleaned and polished, and as a result are very slippery. The customer slips on the floor and breaks their leg.
  • One of the employees of your electrical company visits a home for an electrical wiring job and accidentally causes a fire in the customer’s home.
  • An advertisement you placed results in an individual claiming libel or slander.
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