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General Liability Insurance for LLC: Here's Everything You Need to Know

3-minute read

Mariah Bliss

Mariah Bliss

24 May 2022

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It’s finally happened: You’ve decided to get general liability insurance for your LLC.

Let us be the first to tell you congrats, because even though we’re insurance nerds, we think that the decision to protect your LLC with business insurance should be celebrated.

And starting with GL insurance is a smart idea, since it can cover some of the more foundational risks you may face as a business owner.

So what exactly is general liability insurance for LLC? And what can you expect it to cover? Wonder no more - we’ve got the answers here.

General Liability Insurance for LLCs: The Basics

When it comes to business insurance, general liability (GL) insurance is one of the most important (and popular) policies to get. This is especially true if your LLC works with customers or vendors. A GL policy can cover costs that may come with accidents, injuries, and damage to someone else or their property.

Because, let’s face it - accidents can happen to the best of us. And even if you do everything perfectly, you could still have a customer sue you and claim that you caused an accident or property damage (even when you know you didn’t).

Want more info? Let’s take a closer look at what general liability insurance can cover.

What Does General Liability Insurance for LLC Cover?

General liability insurance can usually cover:

  • Bodily injury to another person (e.g., a customer)
  • Third-party property damage
  • Personal and advertising injury
  • Medical expenses

Here’s how it can work. Imagine you’re running a carpet cleaning business. You’re cleaning a customer’s carpet when your machine’s fluid reservoir explodes. All of that liquid leaks through the carpet and damages the wood floor underneath. No way to sweep that under the rug.

Now imagine you had the foresight to get general liability insurance. Your policy could cover damages related to the wood floor, as well as legal fees if your customer sues you. Without it, you might have to clean out your bank account.

You don’t need to just operate heavy equipment or work on someone’s home to benefit from GL insurance. Let’s say you’re a massage therapist. Your biggest piece of gear is likely a padded massage table, so what could possibly go wrong there?

How about if, while setting up your table in a client’s home, you accidentally knock over and shatter an expensive antique vase? Turns out it was recently appraised for several thousand dollars. OK. Relax your muscles and breathe slowly. With general liability insurance, you’re covered for the damage.

Oh, and did we mention that general liability insurance can also cover your legal expenses if you’re ever brought to court over a claim?

That’s right: If a customer decides to sue you for damages related to your work, your insurance policy can cover the costs of an attorney to defend you in court.

Plus, if the customer is successful in suing you, your policy can pay out the cost of the claim (up to your policy limit).

That means the only thing you have to pay out is the cost of the deductible, which can be a grand total of $0, depending on the insurance provider you choose.

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Heads Up: Here’s What General Liability Insurance for LLC Doesn’t Cover

Like with all insurance policies, there are a few things that won’t be covered by your general liability policy.

While every insurance provider has different exclusions, here’s an overview of what GL insurance typically doesn’t cover for LLCs:

  • Intentional damage
  • Damage to your own property
  • Injuries to your employees
  • Your work vehicle
  • And more

It’s a good idea to go through your LLC insurance policy so you have a good understanding of what is and isn’t covered. Anything that’s not covered by general liability insurance can usually be covered by another type of policy, like professional liability insurance, workers compensation, and more.

How Much Does General Liability Cost for a Small Business?

In order to calculate your GL costs, we’ll ask you for some information, like:

  • The type of work you do
  • Where you’re located
  • How many employees (part-time or full-time) you have
  • And more

How is general liability insurance calculated for contractors?

If you’re a contractor, you should expect to be asked the above questions; however, we may ask for a little more information, like:

  • The type of contracting services you provide
  • If you do any work in a different industry (for example, you plow snow during the winter but you’re a landscape contractor for the rest of the year)
  • If you work with any subcontractors
  • And more

If you’re still wondering how much does general liability cost for a small business, try our free quote tool to find out. It takes less than 10 minutes to use, plus you could see a range of policy options from the nation’s most trusted insurance providers.

General Liability Insurance for LLC: Enjoy Premium Protection for Less Than You Think!

Whether you just started your LLC or you’ve had it for a few years, taking out a general liability policy is a smart step to protect all of your hard work.

After all, having general liability insurance for LLC means that your business won’t be left financially vulnerable to accidental mistakes or particularly litigious clients. Plus, if you get a policy with a $0 deductible, you can enjoy premium protection without spending lots of money if a claim does happen.

So what are you waiting for? Protect your LLC with a general liability policy from Simply Business today!

Mariah Bliss

Written by

Mariah Bliss

I love writing about the small business experience because I happen to be a small business owner - I've had a freelance copywriting business for over 10 years. In addition to that, I also head up the content strategy here at Simply Business. Reach out if you have a great idea for an article or just want to say hi!

Mariah writes on a number of topics such as small business planning, contractor insurance, and business licenses.

This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer

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