Benefits of General Liability Insurance

General liability insurance is a type of business or individual insurance that covers certain risks that may be imposed. These risks may include lawsuits for businesses or individuals. The complaints against the insured may include risks of negligence or a strict liability to certain tort claims. A general liability insurance policy usually does not include any conflicts of interest issues. Businesses may need general liability insurance because of a claim against the company. Individuals may require insurance because of a professional obligation or certain other requirements. Automobile drivers are required to have automobile insurance to protect against any claims. Homeowners may carry general liability insurance as well.  If you own your own business, then company liability insurance in instrumental is protecting your assets.

BUSINESS APPLICATIONS

Certain business claims of negligence or professional liability claims may occur in the normal course of business. A liability insurance policy protects against the risks of liabilities that may be imposed by lawsuits. The insurance policy protects the insured when the company or its management is sued for certain claims that come under the policy coverage. Liability insurance may protect against a third party who is imposing an insurance claim. The third party insurance claim says that the third party has suffered loss. Damages that are claimed may be unintentional in nature.

INSURANCE CLAIMS AND COMPLIANCE

Insurance claims generally are for unintentional claims. The insurance carrier has a duty or right to defend its insured party. Liability insurance may cover the defense of the claim or the duty to pay out the claim or settle a clear claim. The defense of a general liability insurance claim begins when the insured is sued. A copy of the complaint is sent along with a letter explaining the reasoning behind the lawsuit. The insurance company takes the complaint and can seek a judgment saying that the claim is not covered as a part of the insured’s policy. The insurance company may defend the claim or refuse to do either of these two options.

Insurance companies generally do not ignore a complaint against the insured. Ignoring the complaint may bring about bad faith issues later on for the insurance company. The insurance company may begin a defense against a complaint and may withdraw the defense later on. If the claim is not covered by the insurance policy, then the insurance company has the right to withdraw from the claim. Insurance companies strongly recommend California liability insurance to protect assets in this state due to the increase of regulations.

INDEMNIFY AND SETTLE

An insurance company may indemnify and pay the sums for the claim liability. The claim liability usually has a set policy limit. Settling a claim may occur if the claim is clear and reasonable. The insurance company may have an incentive not to pay the claim and to take the matter to trial. In a trial decision, the insured may lose and the policy is paid up to the limit of coverage. If the matter is taken to trial and the insured wins, then the insurer has no liability. If there is not a trial, the plaintiff may attempt to recover the difference between the amount of the policy limit plus an additional sum of settlement.

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