What exactly is a business liability waiver?
Most people have signed a liability waiver — also known as a release of liability form — at one point or another.
Think back to when you last rented skis, went horseback riding or hired a personal trainer. You usually sign a waiver of responsibility when you pay for something that involves a degree of risk, bodily or otherwise.
But what exactly are liability waivers, and what power do they carry to protect your business?
When do you need a waiver of liability?
A release of liability is when a customer gives up a legal claim for damages in case of an incident causing harm.
If you’re a personal trainer, for example, say you have a client who’s signed a personal injury release form.
In theory, if they sprained an ankle during a training session, the waiver would protect you. It would relieve you of responsibility for the injury in a legal sense.
Or let’s say you owned a carpet cleaning business. A liability waiver would protect you in case a piece of furniture or expensive carpet is damaged.
These days, some businesses are even asking their customers and workers to sign COVID-19 waivers in case of exposure to the virus.
By signing a liability waiver, customers acknowledge the risks involved by their participation in the service or activity. They’re agreeing to remove legal liability from the business owner or company.
This is why it’s best practice to have people sign a release of liability form before working with them.
Does a waiver of liability provide ultimate protection against lawsuits?
The short answer? Not really.
A release of liability form is a legal document that provides some protection from being sued. It’s good to have customers sign them.
In practice though, waivers carry much less clout than their scary language might lead one to believe.
Different states have different laws about waivers and their legal power to fully protect a business.
Often, the circumstances of the accident in question can override waiver terms and lead to unpleasant legal battles.
That's why it's smart to have additional protection in the event of unexpected scenarios.
Business insurance complements the protection a liability release agreement provides.
What’s the difference between liability waivers and general liability insurance?
While not as flashy as other famous duos, liability waivers and insurance make a great team.
General liability insurance can help cover losses due to bodily injury, damage to someone else’s property and copyright claims in your advertisements. A signed liability release form shifts the legal responsibility away from a business owner, but it doesn't completely remove that responsibility.
Depending on the circumstances of the injury or damage, a release form may not be enforced. That’s when business liability insurance can kick in to protect the company from devastating financial consequences.
How to reduce liabilities and stay protected
Don’t let your professional credentials lapse. Make sure to prepare well in advance of certification expiration dates, and take the necessary steps to stay certified.
Always keep learning. There’s no end to the amount of expertise you can have in training, safety, and emergencies. This knowledge can make all the difference in unforeseen scenarios.
Safeguard your information. Whether you keep paper files or use software for your records, make sure your information is secure. You don’t want personal records lost or stolen, opening yourself to legal action and loss of reputation.
Protect yourself with excellent liability insurance. NEXT Insurance specializes in liability insurance. You can get simple and affordable policies designed specifically for your business needs. For example, policies can protect you from potential issues like customer injury and property damage.
Stay alert to industry regulations. You’re wearing a lot of hats when you run your own business: HR, accountant, marketer. However, “I didn’t know,” doesn’t hold up in court. Research regulations related to your business. Check with professional organizations or local government resources to make sure you are in compliance.
Waivers can serve as protection, but aren’t enough.
There’s too much ambiguity and too much at stake to entrust your livelihood completely to waiver signing.
Ideally, every small and medium-sized business should have both a general liability insurance policy and a standard liability waiver form.
How NEXT can help
We offer affordable business insurance policies tailored to your specific needs, 100% online. With 24/7 online access, you can provide your Certificate of Insurance to anyone instantly.
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