If you are seeking online insurance for your business, then you have probably come across some confusing professional jargon. This makes it difficult to decide upon an insurance provider because you don’t actually know what you are signing up for. For example, how are you supposed to know what the ‘limit of indemnity’ is if you aren’t an insurer? As such, we thought we would take it upon ourselves to decode some essential terms that are commonly used by business insurers. Keep reading if you’d like to gain a solid understanding and make better-informed decisions when selecting your insurance provider.
General liability is a type of insurance that protects your business from claims made against it regarding injuries, illness and property damage. Primarily, it is designed for commercial businesses who have been accused by members of the general public. For example, if a customer received a package from your company that was damaged in the mail, they might accuse you of selling a faulty product to them.
As everyone knows, insurance is about gaining money to soften the financial blow after something unprecedented happens. However, your insurance provider will not be able to mitigate the costs of everything – especially when it comes to big expenses, like repairing a damaged car. Therefore, clients must supply an ‘excess’ towards their insurance claims. The excess is the amount of money you will pay in these circumstances.
Professional indemnity is a must for business owners. This insurance will protect you from claims made by customers who felt you gave them bad advice or made a mistake with their case. Professional indemnity is also helpful for third-party claims, such as privacy breaches.
Most insurance firms will provide you with coverage for a year, and then you need to renew your contract with them. However, if a company has continuous coverage, this means your contract will not expire or need to be renewed. This type of coverage will remain intact until you or your provider terminates the contract.
Unfortunately, your employees can sometimes injury themselves whilst working for you. If they have been seriously harmed, they will likely make an insurance claim against your business. Workers’ compensation insurance can help to mitigate the legal costs of being sued for gross negligence, plus it will pay for the employee’s medical bills alongside any money they might have lost after being left unable to work.
Limit of Indemnity
The limit of indemnity is the extent to which you are covered by your insurance policy. There are two limits of indemnity. One is the amount your provider will pay for each individual insurance claim you make. The second is the amount your provider will pay for all of your claims within a specific period of time.
These are some essential business insurance terms. It is incredibly important to understand them all, so you can make sure that your company has the complete coverage it needs.