Today, general insurance is required because we live in a society where money is uncertain, and you never know when you could need financial support. Insurance acts as a safety net, protecting customers from various potential issues. Insurance plans exist in several forms and sizes depending on the demand. Life and health insurance are the two types of coverage people buy the most commonly. However, some insurance policies are customised and created to fulfil specific requirements. Customers that require coverage for certain issues, as opposed to broader issues like life and health, acquire these types of insurance. One of these is liability insurance.
How Does Liability Insurance Work?
A lot of unintentional liabilities could occur even if a corporation takes all reasonable precautions to avoid them. For instance, even a minor mistake that causes a customer discontent or harm could lead to a pricey lawsuit against the company or the expert. Fortunately, several liability insurance options could help one avoid the financial damage caused by such events. A liability insurance policy shields people and businesses from the threat of being held accountable or sued for negligence, malpractice, or injury.
Liability Insurance Policy Types
- Employer’s Liability: This type of insurance covers any employer’s responsibilities under the law if a worker is injured on the job or while on the clock. Businesses occasionally ignore this as trivial, but they risk going out of business if they are confronted with a claim like this.*
- Third-Party Liability: This insurance plan compensates victims of losses the insured creates. The first party is the insured, the second is the insurer, and the third is the damaged party or the individual or entity making the claim.*
- Professional Liability: This insurance shields you from the costs and hassles resulting from lawsuits filed against you or your company for failing to deliver professional services. A professional liability policy could be helpful if you have obligations that must be paid.*
- Goods Liability: This type of liability insurance protects you from customer claims from accidents caused by using your goods. For instance, if a customer’s cell phone explodes while charging or harms them in any other way, they may sue the company that made the phone. Such lawsuits could cost the company millions of dollars if it doesn’t have the appropriate product liability insurance. Claims that packaged foods have harmed people’s health and well-being may be made in response to their use.*
- Insurance Against Public Liability: This liability insurance protects you from lawsuits that claim your company, its products, or its employees have damaged members of the public. Businesses in India working in hazardous areas are required by the Public Liability Insurance Act of 1991 to purchase public liability insurance. Other companies are not obligated to do so, but it is highly recommended.*
Liability insurance is a fundamental aspect of risk management that provides protection and peace of mind for individuals and businesses alike. It serves as a financial safeguard against potential claims and legal expenses arising from accidents, injuries, or damages caused to others.
*Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.