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Common Liability Insurance Exclusions

General liability insurance is coverage for accidents that occur during business operations — case in point: a toddler visiting a business spills the contents of his sippy cup and, five seconds later, a grandmother slips on the liquid and breaks her hip.

While general liability insurance is great for Hollywood business owners, and many things are covered, there are some common exclusions of which Hollywood business owners should be aware.

1.  Damage to Property

Business property is not typically protected by general liability policies. The office building, materials, equipment, or inventory will not be covered if they are damaged during business operations. Instead, you will need a commercial property policy for coverage.

2.  Workers’ Compensation

If an employee is injured during the course of work, this will not be covered by a general liability policy. Instead, a workers’ compensation policy will cover those injury claims. Most states require workers’ compensation for any business that has at least one employee.

3.  Liquor Liability

There is no coverage for liquor liability if a business sells, makes, serves, or furnishes alcohol. The company must get a separate policy that is underwritten specifically for the liquor risk.

4.  Expected or Intended Damage

If an action is done intentionally, and a reasonable person would expect damage or injury to result from the activity, then any damage or injury sustained will not be covered. Insurance will not protect you if you intentionally do something that will lead to a claim. For instance, you will not be covered if you do not refrigerate the food you are serving and it causes a customer to become ill.

5.  Contractual Liability

If you assume another party’s liability through a contractual agreement, then you cannot have bodily injury or property damage coverage. This may happen with construction companies that assume the liability of a project while the property is under development.

6.  Pollution

Pollutants may be released as a result of business operations. If so, then there is no coverage for claims against this. Also, general liability policies have the same exclusion regardless of whether the pollutants were released suddenly or gradually.

7.  Automobile, Aircraft, Watercraft

In order to have coverage for damage caused by the use of aircraft, automobiles, or watercraft (whether owned, leased, or borrowed), Hollywood business owners would need a policy specific to aircraft, automobiles, or watercraft. These are excluded from the general liability policy.

8.  Damage to Your Work

When work fails to operate properly after completion, and there is consequently property loss or injury, there will not be coverage from the general liability policy. A professional liability policy that protects a business for professional errors would be required to have coverage.

9.  Product or Work Recall

In the event that a company has to recall its own products, all claims that arise from the recall will not be covered by general liability. Potential damages will be excluded from coverage, but the cost of inspections, removal and adjusting of the defective product will also be excluded.

It is imperative that you are fully covered as a Hollywood business owner. If you have questions about your coverage, call a trusted Hollywood lawyer at 954-915-7405.