Commercial Liability Insurance Minimums

Commercial liability insurance covers your business and protects your business from claims made against it. Commerical liability insurance protects the insured from bodily damage. This type of coverage protects you and your business assets.


The insurance company will determine whether your company is eligible for insurance and how much insurance coverage you will need. They decide this through their underwriting, depending on the classification of your business. Any new business must fall under these classifications, and even if you have a clean record, you may experience high premiums for this type of insurance, depending on the risk factors for your business.

Risk Factors

Your coverage needs will depend on the risk factors associated with your business. This can include the location of your business, as well as what your business entails. The reason location is a determining factor is that if you are located in a state where plaintiffs are favored, you will need more protection from your commercial liability insurance.

Under the policy, your insurance is obligated to pay all, or part of, defense and legal costs of a claim. Covered under your policy are claims that include personal and bodily injury, advertising injury as well as any compensation or other damages your business is legally obligated to pay by the courts. Under general liability policies, punitive damages will not be covered, as they are deemed a punishment for deliberate acts. Without this coverage, however, your business would be responsible for the cost of all damages.

Finding an Agent

Contact several different agents or insurance companies for estimates on what your commercial liability insurance is going to cost. Be certain your agent is knowledgeable in your line of business and that they are licensed for the type of insurance you need. You can contact your state’s Commissioner of Insurance to check on the agent’s license.


There will be a maximum amount your insurer will pay per occurrence of claims. Your business will be responsible for anything over the established amount. In order to cover your business, you can purchase an Umbrella Liability Insurance policy. This added coverage would take care of the extra liability amount not covered by your standard commercial liability policy.

As always, take precautions in your business before accidents occur to keep your rates down. Always check with your insurance company for safety tips and steps for your business. Here are a few ways to lower the liability risks:

  • Keep quality control standards high
  • Properly train all employees
  • Keep all company records complete and up to date

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