Commercial General Liability Insurance
Commercial General Liability - The Most Basic Form of Business Insurance
If you have only one form of buisness insurance, it is most likely Commercial General Liability. CGL policies cover claims in four basic categories of business liability:
- Bodily Injury
- Property damage
- Personal Injury (including slander or libel)
- Advertising Injury
Employer's Liability for Employee's Acts
At times, employers, not their employees will be held liable for the conduct of their employees. Even if the employer had no intention to cause harm and played no physical role in the harm. To understand why, you have to become familiar with two basic concepts that underlie employer liability.
Employers are viewed as directing the behavior of their employees and therefore must share in the positive as well as the negative results of their employee's behavior. Because an employer is legally entitled to the rewards of an employee's labor (profit), an employer also has the legal liability if that same behavior results in harm.
When someone is injured or harmed and needs to be compensated, the one most likely to pay is the employer. The legal system is interested in making the victim whole, and assigning liability to the employer rather than the employee has the best chance of meeting that goal.
Negligent Hiring or Retention
Negligent hiring or retention liability, unlike job related misconduct, arises from acts performed by an employee outside the scope of his or her employment. The most common example of this is to hold an employer liable for the criminal conduct of an employee, which is obviously outside the scope of employment. The basis for liability is that the employer acted carelessly in hiring a criminal for a job that the employer should have expected would expose others to harm.
In addition to covering the claims listed above, Commercial General Liability policies also cover the cost to defend or settle claims - even if the claims are fraudulent.