Explain the nature of liability insurance

Liability insurance General liability insurance (GL) is coverage that can protect you from a variety of claims including bodily injury, property damage, personal injury and others that can arise from your business operations. General liability insurance is often combined with property insurance in a Business Owners Policy (BOP), but general liability insurance also is available to many contractors as standalone coverage through the Progressive Commercial Advantage

Who Needs General Liability Insurance As a contractor or small business owner, you need some form of general liability insurance to safeguard your livelihood. A single accident could result in a lawsuit that you might not be able to handle. A great way to protect against this type of situation is to make sure you carry enough general liability insurance. Some employers might also require you to carry a certain amount of general liability insurance before you can work for them.

Umbrella insurance Umbrella insurance provides an additional layer of personal liability protection. A single policy covers all underlying policies you own (auto, home, motorcycle, boat, etc.) and kicks in if the liability limits on these policies are exhausted

Professional liability insurance Protects your business assets from claims that may result from advice, expertise or professional services you provide. If your business engages in these activities, you could be at risk for being sued by a customer, client or other party who claims he or she lost money or was harmed in some way due to a negligent act, error or omission.

Who generally purchases professional liability insurance? Any individual in a profession that provides advice, expertise, recommendations or a professional service to customers, clients or another party would benefit from professional liability insurance. Professional liability insurance protects you in cases of faulty service (errors) or failure to provide a service altogether (omission). This type of insurance coverage pays the cost of your defense and any damages awarded (up to policy limits). Insurance companies have developed many specialized policy forms that respond to the individual risks of particular professions and services.

Commercial general liability A standard insurance policy issued to business organizations to protect them against liability claims for bodily injury (BI) and property damage (PD) arising out of premises, operations, products, and completed operations; and advertising and personal injury (PI) liability

D&O liability A type of liability insurance covering directors and officers for claims made against them while serving on a board of directors and/or as an officer. D&O liability insurance can be written to cover the directors and officers of for-profit businesses, privately held firms, not-for- profit organizations, and educational institutions. In effect, the policies function as "management errors and omissions liability insurance," covering claims resulting from managerial decisions that have adverse financial consequences.

Employer liability Product for employers that protects them from major financial loss if a worker experiences a job-related injury or illness that workers compensation doesn’t cover. Employer's liability insurance can be packaged with workers compensation insurance to further protect companies against the costs associated with workplace injuries, illnesses and deaths that aren’t covered under workers compensation

Liability insurance is beneficial and/or required Professionals that operate their own businesses need professional liability insurance in addition to an in-home business or businessowners policy. This protects them against financial losses from lawsuits filed against them by their clients. Professionals are expected to have extensive technical knowledge or training in their particular area of expertise. They are also expected to perform the services for which they were hired, according to the standards of conduct in their profession. If they fail to use the degree of skill expected of them, they can be held responsible in a court of law for any harm they cause to another person or business

Errors and omissions A professional liability insurance that protects companies and individuals against claims made by clients for inadequate work or negligent actions. Errors and omissions insurance often covers both court costs and any settlements up to the amount specified on the insurance contract.

Negligence A failure to behave with the level of care that someone of ordinary prudence would have exercised under the same circumstances. Five elements are required to establish a case of negligence:  the existence of a legal duty to exercise reasonable care a failure to exercise reasonable care cause in fact of physical harm by the negligent conduct physical harm in the form of actual damages proximate cause, a showing that the harm is within the scope of liability.

Malpractice Insurance A type of professional liability insurance purchased by health care professionals (and sometimes by other types of professionals, such as lawyers). This insurance coverage protects health care providers against patients who sue them under the claim that they were harmed by the physician's negligent or intentionally harmful treatment decisions.

Performance Activity Each team is to develop a creative four-minute skit that illustrates the purpose of and need for a certain type of liability insurance (e.g., personal umbrella liability, professional liability, commercial general liability, D & O liability, employer liability, etc.). After all teams have presented their skits, We will discuss of the information presented by the teams.

Performance Activity As a business owner, it's your responsibility to do everything within your means to limit risk and to keep the business running smoothly. But how does one go about limiting the possibility of a lawsuit to ensure business continuity? Read 3 articles where companies, small businesses, doctors, or lawyers were victim to lawsuits. Create a Presentation explaining the case, what the company was being sued for, the outcome, and what they could have done to prevent the lawsuit if they were negligent.