Liability Insurance is a part of the general insurance system which is also termed as liability insurance small business. It protects the business from the risk of being sued or any legal obligations for malpractices, Injury or negligence. If an insured found legally accountable for any Body Injury (if the client gets hurt due to a negligence), property damage and data loss (any potential loss at clients property like machine damage leading to data loss) or any personal injury (to the client’s reputation) basis, which a the business or a person can be sued in that case the insurance company would cover all the legal cost and payouts, as long as the damage is unintentional.
This type of insurance is very important for all those who could get into any legal liability due to their nature of work, especially the medical practitioners & small/large business owners. A business owner can opt for this insurance if there is a risk for the product being faulty and can cause damage to the client/end user. The same insurance can also be purchased if there is any potential risk of injury to its company’s employees during business operations.
Liability Insurance provides complete business protection. The respective agents would help identify various kinds of liability insurance required at all levels of the business ladder. It helps cover all medical expenses, attorney fees & damages the insured is legally responsible for. Also, it covers the situations which business owner may never have even anticipated
In case of any situation arises an insurer have some major duties to pay: Duty to defend duty to Indemnify & last but not the least responsibility to settle claims:
Duty to defend: Whenever a legal complaint is issued on some tenders and contracts then in that situation insured sends the policy letter along with the complaint letter to the insurer and the insurer is free to take any 3 decisions basis the available collateral. First, they can declare no coverage due to the proof of the paper work happen pointed between both the parties. Second insurer can decide to defend from insured side or refuse either of the 2 options stated above. The last option is completely discarded as that can result in the bad reputation for insurer, but if the insurer decides to defend they involve their in-house lawyers or hire any outside the law firm to resolve the issue.
Duty to Indemnify: To decide on paying all claims for which the insured is held liable, not exceeding the agreed policy limit amount
Duty to settle reasonable claims: It happens when the liable amount exceeds the policy limits. In that case the insurer would not want to settle the claims as it will be a win situation for the insurer and a loss making situation for the insurer as the entire amount would go into the claim. However, if the insurer refuses to settle the claims and if the case goes to trial the insured would end up paying the exceeding amount.
Not following any of these above pointers may lead to the insurer’s bad reputation and breach of contract.
Latest posts by Suresh (see all)
- CPMFast Review : Online CPM Advertising Network - Jan 22, 2017
- Linkpay.co Review : Shorten URLs And Make Money - Jan 17, 2017
- Things to Be Aware of while Traveling to Third World Countries - Jan 17, 2017