Commercial Liability Insurance Policy

Businesses, in India and around the world, are getting more vulnerable to increased risks, litigation and liability claims for bodily injury (BI) and property damage (PD) arising out of their business operations. These risks can be as simple as a slip and fall injury in the business premises, or an employee causing damage to a third-party employee or damage to someone else’s property, Or your products causing damages because of a defect in the product, a deficiency in the packaging, inadequate or wrong labelling on any information relating to the product.

These risks can lead to financial losses to the third party which in turn can cause legal liabilities and eventually lead to financial losses to the business. To protect the business against these liabilities, Commercial general Liability (CGL) insurance policy that offers comprehensive coverage is required. A commercial general liability insurance also helps a business meet contractual obligations – it is common for overseas organizations to insist on the purchase of a commercial general liability insurance policy while conducting business in India.

What is covered under a CGL insurance policy?

The policy provides indemnity in respect of:

• Legal costs in defending proceedings.
• Any damages awarded to the claimants including out of court settlements.

Coverage is provided for premises liability, operations liability, product liability, and completed operations liability, It also can provide coverage for claims resulting from personal and advertising injury and also some supplementary benefits like tenant’s liability for damage by fire to the rented premises and primary medical expenses.

Extensions available under Commercial General Liability

Some of the major extensions to the cover are listed below:

• Liabilities incurred due to natural calamities/Act of God perils
• Batch clause
• Transportation Liability
• Food & Beverages Liability
• Sudden & Accidental pollution Liability
• Terrorism legal liability
• Vendor’s Liability
• Technical Collaborators Liability
• Product Recall Expenses Liability
• Non owned and Hired Automobile Liability
• Property under care,custody and control (including valet parking)
• Coverage for participation in events and promotional activities in the conduct of the business

Major Exclusions

Some of the exclusions are as listed below:

• Prior and Pending actions/claims
• Intentional / Deliberate acts
• Known risks
• Fines and penalties
• Contractual liabilities
• Electronic data loss
• War and other related perils
• Employers Liability

Since the policy wordings vary from insurer to insurer, it is necessary to understand clearly the coverage and exclusions offered in the context of business operations of a company.

*(The details furnished above are only a summary of the policy features and do not describe all the terms, conditions and exclusions in the policy. Policy finally issued upon binding the cover represents the legal contract between the insured and insurer. If you are interested to know more, please get in touch with our representative)