General Liability Insurance in California

Small businesses are crucial to California’s economy. The state has over 4 million small businesses, collectively employing 48.5% of its workforce. These businesses also create two-thirds of new jobs in the state.¹

To ensure they’re protected financially, small businesses in California need the right insurance. General liability insurance covers common accidents that can happen at any business, like customer injuries or property damage. There are several situations where general liability insurance can help protect businesses, such as:

• A customer gets injured at a retail store in San Jose when a product display falls over.
• A cleaning company in Palm Springs knocks over an expensive vase and it shatters into pieces.

With a general liability policy in place, your small businesses will have protection from costs related to these types of accidents.

Commercial general liability is a common insurance for small businesses and self-employed professionals. Because it protects against so many everyday risks, general liability is a popular purchased by new businesses.

Is General Liability insurance required by law in California?

Generally, small businesses are not required to have general liability insurance in California. But even though the state doesn’t mandate it, there are a number of advantages to having this insurance.

Financial protection

General liability insurance offers broad coverage that helps to protect your business financially. This type of California business insurance covers risks that affect almost every business, including third-party injuries (like customers) and damage to someone else’s property. In addition, there is coverage for certain types of legal disputes, like accusations of libel or slander.

Business licenses

Depending on where you work in California, you may need general liability insurance in order to obtain business licenses, permits or certifications. Check the official website for your local city or county government, or contact your city clerk to find out if there are any insurance requirements for your business.

Client contracts

In some industries, it’s common for clients to request proof of coverage before signing a contract. If you don’t have general liability insurance, you may lose business from potential clients.

Lease agreement

Commercial leases sometimes include requirements for general liability insurance. If you plan to rent commercial property for your business, the landlord may require a minimum level of coverage as part of the lease agreement in case an accident damages the property.

NEXT  offers a convenient way to explore your coverage options for thousands of different types of businesses. You can do everything online, and the whole process only takes about 10 minutes. Our U.S.-based insurance advisors are available to help you every step of the way.

Start a free online instant quote to explore your options for general liability insurance for California small businesses.

What types of businesses might need General Liability insurance in California?

Because this coverage is applicable in just about every industry, all business owners should consider the potential benefits of having commercial general liability insurance in California. The amount of coverage you want depends on your appetite for risk.

For example, a general contractor in San Diego has a greater risk of client injuries and property damage than an accountant in the same city. The former may want a higher level of coverage for general liability insurance for California contractors to ensure they’re fully protected if an accident occurs.

However, accidents can happen in any line of work, including desk jobs. So even if the risk of accidents is lower for your industry, it’s still a good idea to get general liability coverage to protect your business.

How does General Liability work in California?

General business liability insurance in California provides coverage from accidents that physically harm someone or cause damage to someone’s property.

For example, say you own a real estate agency in Sacramento and one of your employees knocks over and breaks an expensive vase during a showing. Your general liability coverage would cover the costs to repair or replace the vase.

Or, if you run a pressure washing business in San Francisco and a client trips over the cords to your equipment and fractures their wrist, this insurance would help pay for their medical expenses.

Keep in mind that general liability doesn’t cover injuries involving employees and business owners. For that, you’ll need workers’ compensation insurance, which is required for all California businesses with employees.²

General liability insurance also provides coverage for libel, slander and defamation. If your competitor sues you for making negative comments about them in an advertisement, this insurance can help cover legal fees, settlements or judgments.

How much is General Liability insurance in California?

General liability insurance in California costs more for industries that have a higher risk of accidents. However, other factors can influence the amount of monthly insurance premiums, including:

• The number of employees you have
• The type of work you do
• Your insurance claims history
• The locations where you do business
• How high you set your policy limits

NEXT insurance offers cheap general liability insurance for California businesses. 50% of our customers pay less than $25 to $45 per month on general liability insurance**. You can customize your policy to make sure you get the coverage you want so you don’t overpay.

How NEXT Insurance helps California businesses

NEXT offers general liability insurance in California for small businesses. We also provide affordable general liability insurance for sole proprietors in California.

With our convenient online services, it only takes about 10 minutes to get a quote, review coverage options, purchase insurance and get a certificate of insurance.

Start an instant general liability insurance quote in California today.

Need some help finding the right insurance? Our team of licensed insurance advisors is standing by to assist you.

¹ California Small Business Fact Sheet

² Division of Workers’ Compensation Employer Information

³ State of California DMV Insurance Requirements