General Liability insurance

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What is General Liability insurance?

Your general liability policy provides financial protection if you are held responsible for some of the most common accidents that can occur at a business, such as a customer injury or damages to someone’s property. It also provides coverage if you are forced to defend an accusation of libel or slander.

General liability insurance covers the risks that affect almost every business, no matter what your industry. It is the most common insurance for small businesses and self-employed professionals, and it’s typically the first policy purchased by new businesses.

Who needs General Liability insurance?

General liability is included in most business insurance packages because it covers the risks that many business owners face every day. It is not typically required by law, but some clients and agencies could ask you to have a certificate of insurance before they work with you.

Here are some examples of businesses owners who might need general liability coverage:

  • General contractors sometimes need general liability as part of the license requirements in their state.
  • Fitness instructors need coverage for some certifications, and it’s usually required if they work at a gym.
  • Anyone who wants to rent commercial property could be required to have coverage as part of their commercial lease.

How do I get a General Liability certificate of insurance?

When someone asks you to have coverage, they will typically request a certificate of insurance (COI) that includes your business and insurance information.

The client or organization you are working with might also ask you to add them to your certificate. In the insurance industry, this is called an additional insured. Next Insurance simplifies the process with a digital certificate of insurance that you can access 24/7 from a mobile device or computer.

You can update your information and share your COI in a matter of minutes.

Why is General Liability important?

You’ll get help paying for expenses after an accident if you’re held responsible for injuring someone or damaging their property. General liability can also help cover defense costs if you are accused of libel or slander.

Here are more details on what makes general liability insurance so important:

It helps you get more jobs

Business liability insurance shows that your business is reliable and trustworthy. It gives clients peace of mind knowing that you will take responsibility for your mistakes.

It could give you a competitive advantage if your potential client has a choice between your business and another business that doesn’t have insurance. Many larger clients also require coverage before they’ll sign a contract with you.

It lets you run a legal business

Some states and cities will only give you a business permit if you have active general liability insurance and a certificate of insurance. If your business is certified or accredited by a professional organization, you might also be required to keep your general liability insurance active.

Your commercial lease might require general liability insurance

If you plan to lease commercial space, your landlord could also insist on seeing your general liability insurance certificate. Coverage is often required because it shows you will have the financial protection needed to cover expenses related to property damage or injuries related to your business at the leased space.

It lets you focus on growing your business

When you have general liability insurance, it gives you peace of mind. You won’t have to worry about what you would do if a client trips and falls or how you would pay for a new vase if you accidentally broke one in a client’s house.

Having business liability insurance means that instead of feeling nervous about what could happen, you can concentrate on growing your business.

What does General Liability cover?

General liability business insurance protects you from unexpected expenses related to many types of accidents that can result in injuries, damage to property you don’t own, and accusations of libel or slander.

Accidents that cause physical harm to someone

Accidents are not 100% unavoidable, and unfortunately, some accidents cause physical harm to people who come into contact with you, your employees, and your business.

For example, you put your toolbox down on the sidewalk for a few moments while you’re loading your van in the morning. A jogger doesn’t see it, trips, and breaks an arm. In this case, you could be sued for medical costs, and if you don’t have general liability insurance, you would need to pay out of pocket to cover any related expenses.

Lawsuits related to an injury generally fall under three categories that are covered by general liability insurance:

Bodily injury: General liability insurance can help pay for an injured person’s medical expenses up to your policy limit, excluding employees and yourself. The amount and extent of coverage is determined on a case-by-case basis depending on the policy you purchase.

Loss of income: If you are ruled responsible for an injury and the injured person is forced to miss work, your insurance would cover their loss of income.

Pain and suffering: In some cases, your policy can also cover claims related to pain and suffering, which refers to the physical or mental strain that can occur as a result of the accident.

Damage to someone’s property

Your general liability insurance policy covers you for damage that you cause to someone’s property. The best general liability insurance for small business includes both significant and less serious accidents.

Here are some examples:


You didn’t see a small rock during your pre-inspection of a lawn you are mowing. When your mower goes over it, the rock goes airborne and shatters a large plate-glass window. The client insists that you pay for the replacement cost.


You park your van in an office parking lot for a renovation construction project. As you’re taking out your tools, you slip and scratch the CEO’s shiny red Porsche. You have to pay for the cost of getting the entire car repainted at a certified dealer.


Your beautician assistant is giving a client a manicure and drops the bottle of nail polish. It smashes on the floor, splashing scarlet nail polish all over the client’s expensive Gucci handbag. The client wants you to pay for a replacement bag.

Copyright infringement, libel, and slander

Personal and advertising injury claims usually occur when you’re accused of invading someone’s privacy, copyright or advertising infringement, and defamation of character.

Learn more about each category with these examples:

Breach of Privacy

After renovating a client’s old bathroom, you take some pictures and use them on your website as an example of your work. Your client sees the photos and gets very upset. They sue you for breaching their privacy by using photos of their home without permission.

Copyright Infringement

Your flyers about your personal trainer business refer to you as ‘“The Rock.” The celebrity Dwayne “The Rock” Johnson sees them and his management team sues you for copyright infringement because you used his signature nickname.

Defamation of Character

Your new marketing campaign name checks your biggest competitor and claims that he offers substandard services that don’t follow local regulations. The business owner sues you for defamation of character because he claims your campaign is untrue.

Bodily injury

Someone trips over your tools and breaks their leg.

Advertising harm

Someone sues you for improper use of images in your advertising.

Libel, slander and defamation

An employee bad-mouths a client on social media and the client sues you.

Property damage

You drop heavy duty equipment inside your client's house and damage their hardwood floor.

Medical payments

Someone gets injured at your work site and asks you to pay for medical expenses instead of suing you.

Court and legal fees

You need an attorney to defend against a lawsuit even though you did nothing wrong.

What isn’t covered?

Your general business liability policy covers many different situations, but it doesn’t cover everything. You might need to buy other types of liability insurance, depending on your business.

Tools & Equipment insurance

If you are a contractor or own a cleaning business, you can add tools & equipment coverage to protect your gear if it is damaged or stolen.

Professional Liability insurance

General liability insurance does not cover professional mistakes. For that, you’ll need professional liability insurance, also known as errors and omissions insurance. It can cover associated costs when a client claims you gave bad advice, made a mistake, or missed a deadline and caused financial harm.

Workers’ compensation insurance

In most states, if you have employees, you are legally required to have workers’ compensation insurance. A workers’ comp policy will cover medical bills for work-related injuries or illnesses, lost wages, and important liability protections for your business.

Commercial auto insurance

Most personal auto insurance policies won’t cover you for injuries or damages if you drive for business purposes. You are required by law in most states to have commercial auto insurance if you or your employees use a business-owned vehicle.

Injuries to you or your employees

Injuries to you or your employees

Company vehicles

Company vehicles

Damage to your equipment or tools

Damage to your equipment or tools

Products you produce

Products you produce

This is a brief summary of your policy and does not supersede the policy documents. If you want full details, please call us.

How much does General Liability insurance cost?

The cost of general liability insurance is different for each business. Several factors influence the price you’ll pay for coverage, including your industry, the size of your business and how much coverage you want to purchase.

What is your industry?

The amount of risk that you face in your industry is used to determine your insurance costs. If your business is in an industry that is more prone to accidents and injuries, than you will typically pay more for insurance.

For example, a carpenter who takes saws and other tools to different locations is more likely to have an accident that would be covered by general liability than a tutor who mostly works at a desk with students. That’s why carpenter insurance is usually more expensive than tutor insurance.

What is the maximum amount of coverage that you need?

The answer to ‘How much does general liability insurance cost?’ depends on your aggregate limit. This is the maximum amount of insurance that you could claim from your general liability insurance policy. The higher your total coverage limit, the higher your small business liability insurance costs.

What is your deductible?

If you have a larger deductible, you’ll pay less for general liability insurance for your small business. At Next Insurance, we don’t charge a deductible for our general liability insurance policies, so you won’t need to worry about it.


What is the Live Certificate?
The Live Certificate is the digital alternative to paper/downloaded Certificates of Insurance. It’s completely online proof of insurance which you can easily and instantly share with anyone, by email or through a link.
Who is Next Insurance?
We're a group of designers, engineers, and insurance geeks based in Palo Alto, California. We want to use our deep industry experience at companies including Intuit, American Express, PayPal, Check, and Oracle to transform insurance for small businesses. We're an insurance agency licensed in all 50 states.
What does Live Certificate cost?
It’s free to all Next Insurance customers. It’s also unlimited; send as many Live Certificates as you need, anytime.
Can I add an additional insured to my Live Certificate?
Yes! When you click "Share Proof of Insurance" from within the customer portal, you'll be asked if you need a general proof of insurance or one with a venue or client as additional insured. As soon as you input the details of the additional insured you're adding, you can add their email address and we'll send them over the certificate for you.
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