General Liability Vs. Business Owners Policy

General Liability Vs. Business Owners Policy: How are they similar? How are they different? This article will provide the answers to those questions.

By Amanda Moss | Licensed Agent at Learnandserve.org | Powered by A Plus Insurance

When it comes to your business, having the right insurance coverage is important, however it can be overwhelming when trying to decipher which is the right coverage for you. Notice what general liability vs. business owners policy includes or excludes.

What Is General Liability Insurance?

General liability insurance is a type of business insurance that provides coverage for claims involving bodily injury, property damage, and personal or advertising injury caused by the business’s operations, products, or services. It helps protect businesses from financial loss due to legal claims or lawsuits.

General liability insurance (GLI) protects businesses from claims related to accidents, injuries, and negligence. This includes:

  • Bodily Injury: Coverage for injuries sustained by third parties (e.g., customers, clients) due to business operations.
  • Property Damage: Coverage for damage to others’ property caused by the business.
  • Personal and Advertising Injury: Covers non-physical harm such as libel, slander, or copyright infringement.

Key Components of General Liability Insurance:

ComponentWhat It CoversExample Scenario
Bodily InjuryMedical costs, legal fees for third-party injuriesA customer slips and falls in your store.
Property DamageDamage caused to others’ propertyYou accidentally damage a client’s property.
Personal InjuryNon-physical harm (e.g., defamation)A competitor claims you defamed them in an ad.
Advertising InjuryInfringement in marketing/advertisingYou unintentionally use copyrighted content.

Types of Businesses That Need General Liability Insurance:

Business TypeReason for Needing Coverage
Retail StoresHigh customer traffic increases injury risks.
ContractorsPotential for accidental property damage.
RestaurantsRisk of slips, falls, or food-related injuries.
Consulting FirmsProtection against personal/advertising injury.

General Liability Insurance: Coverage Components

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Risk Factors by Business Type

Now interactive! (Beta)

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The first chart shows a breakdown of the different components of general liability insurance coverage, with bodily injury and property damage making up the largest portions of coverage needs.

The second chart highlights the risk factors for different types of businesses. Retail stores, for example, have the highest risk factor due to high foot traffic, while consulting firms have a lower risk factor related to personal and advertising injury.

These visuals help illustrate how general liability insurance protects businesses across various industries and against multiple types of risks

How to Get a Free Quote – Business Owners Policy

01.

Contact Us​

02.

Details

03.

Quote

04.

Decision

What Is A Business Owners Policy?

A Business Owners Policy (BOP) is a type of insurance policy that is specifically designed for small to medium-sized businesses. It combines several different types of coverage into one single package, offering a comprehensive insurance solution for business owners.

There are 3 main coverages:

Property InsuranceProtects physical assets of your business like a building or furniture against losses caused by fire, theft, vandalism, or other covered perils
General Liability InsuranceProtects your business from claims arising from bodily injury or property damage caused to customers, vendors, or the general public due to your business operations
Business Interruption InsuranceProtects the financial impact of a temporary shutdown or disruption to your business operations due to a covered event
In addition to these coverages, a BOP may also include additional optional coverages or endorsements based on your business needs, such as, crime insurance, data breach coverage, or equipment breakdown insurance.

What Are The Similarities And Differences Between General Liability Vs. Business Owners Policy?

There are more differences than there are similarities with general liability vs. business owners policy.

Similarities:

Both General Liability Insurance and a BOP provide liability coverage

Both policies typically include coverage for legal defense costs associated with liability claims. This can help cover attorney fees, court costs, settlements, or judgments.

Differences:

General Liability Insurance focuses solely on liability protection. It does not include coverage for property or business interruption. BOP combines liability coverage with property insurance and often includes business interruption coverage, which helps compensate for lost income/ongoing expenses if your business operations are temporarily disrupted due to a covered event.

A BOP is a packaged policy that combines multiple coverages into a single policy, more convenient and cost effective. General Liability Insurance is a standalone policy solely focused on liability coverage.

General Liability Insurance policies can be tailored to some extent by adding optional endorsements or additional coverages. BOP offers a more comprehensive package with pre-packaged coverages, making it a convenient choice for small to medium-sized businesses that want a standardized yet broad insurance solution.

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Last Updated on by Marlon Moss

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