The purpose of liability insurance is to protect you or your company from the risk of lawsuits or legal claims.
As with other sorts of insurance policies, you will be required to pay a premium in exchange for the financial protection the insurance company will provide in the event of a lawsuit against you. When a claim is made against you by another person or entity, the insurance company will step in on your behalf to defend you.
Generally, you will not be protected by your insurance policy if you cause damage to another person intentionally. Your policy will also not protect you from any breach of contract with another person or group.
Liability Insurance Policies Explained
You can expect a defense from your insurance carrier when you are sued. As soon as you receive a copy of a complaint, you must forward it to your insurance company.
The company will either declare that you have no coverage for that particular complaint, or they will agree to defend you based on your policy protections. Depending on the size of the insurance company, they will either use their own lawyers, or they will use specialized attorneys outside of their own company.
Your insurance company will indemnify the costs for which you are held liable. Most policies have a maximum limit that the insurance company will pay. You will be responsible for the rest of the damages or costs.
In most cases, your insurance carrier will want to settle any claims against you before they go to trial or become more expensive. You will need to work closely with your insurance company when it comes to settlements.
They have a duty to settle, but it might be in their best financial interests to take a chance on going to trial. Work with them on your expectations, and hold them accountable to the provisions outlined in your policy.
Any professional individual or business is always at risk for lawsuits and legal challenges from customers, partners, or competition. Purchasing a comprehensive liability insurance policy is essential when it comes to protecting your professional and financial standing.
For more information, or to get free, no-obligation quotes from a variety of reputable providers, click through on the link below.
A Brief Overview of Liability Insurance
Category : Public Liability Insurance Info
