Solutions for Business

Commercial general liability insurance covers the legal costs and general damages that a business becomes responsible for in a covered liability claim or lawsuit, subject to the limits and conditions of the policy. General liability insurance policies usually protect the business in four categories; bodily injury, property damage, personal injury (including slander), and advertising injury. Punitive damages generally are not covered because they are considered to be punishment for intentional acts.

General liability insurance policies usually states a maximum amount that the insurer will pay during the policy period and often lists the maximum amount the insurer will pay for any one occurrence.

It is important to understand that general liability insurance does not protect your business against every type of liability. Certain risks require separate coverage.

While individual liability insurance policies are available, many businesses find it more cost effective to buy a package policy that includes both property and liability coverage together. For larger businesses, a combined property/liability policy is often referred to as a Commercial Multi-Peril (CMP) policy. Smaller businesses can get similar coverage in a Business Owners Policy (BOP) policy.

As a business owner, you need the same kind of insurance coverage for commercial vehicles as you do for personal vehicles. Cars, trucks, buses, limousines, and certain types of motorized equipment can all be covered by a Massachusetts commercial auto insurance policy.

Non-owned and hired auto liability coverage is also available for vehicles that the business rents or borrows. Businesses with five or more vehicles are eligible for fleet discount pricing.

Just as working safely can keep down the cost of workers’ compensation insurance, so can safe driving reduce the cost of commercial auto insurance. Professional driver training programs, responsible vehicle maintenance schedules, and equipping all vehicles with claims kits have proven to reduce losses for Massachusetts businesses.

Workers compensation coverage indemnifies workers for injuries arising out of or during the course of employment. The coverage is required by law in every state and is provided either through private insurance or, in a few states, through a regulated compensation fund. Benefits generally include medical expenses, death benefits, lost wages, and vocational rehabilitation.

There are usually two parts to a workers’ compensation insurance policy. The first part of the policy transfers liability for all mandated benefits from the employer to the insurance company. The second part provides coverage to employees for work-related injury and illness that is not specifically required by law. Part two is an important liability protection for the business owner and is subject to the limits and conditions of the policy.

Workers’ compensation is a complex coverage.  Each state is the primary regulator of their own rules governing benefits, coverage, and premium calculation. So business owners operating in multiple states must understand the unique requirements of each jurisdiction. Also, premium calculations are based on a number of factors such as the class of business, payroll amount, lost cost modifiers, and experience modifiers. Plus, insurance companies generally offer a number of different rating plans.

Workplace safety is an important part of controlling the cost of workers’ compensation insurance. Insurance companies offer a variety of programs to help employers reduce or eliminate losses.

Commercial umbrella insurance, sometimes referred to as excess liability insurance, is an important source of protection for business owners. The coverage provides additional liability limits on top of liability limits that exist in other commercial policies such as general liability, commercial auto, and employers liability. Umbrella insurance may also protect businesses from exclusions or gaps in underlying liability policies.

Commercial umbrella policies often offer such features as worldwide coverage, blanket contractual liability protection, and extension of protection to additional insureds. However, commercial umbrella insurance generally does not apply to professional liability insurance.

Umbrella insurance policyholders are responsible for keeping the schedule of underlying insurance policies in force, without alteration, during the term of the umbrella liability policy.
Commercial umbrella insurance tends to be relatively inexpensive for the additional protection afforded the business. Plus, as a business owner, you gain the peace of mind knowing that you are covered in the event of an expensive lawsuit.

A surety bond is a guarantee that someone contracted to perform a specified obligation will, in fact, complete that obligation. There are three or more parties involved in a bond transaction.

The first is the principal. This is the person obligated by contract to perform specified responsibilities. The second is the obligee – the party who is the recipient of the contracted obligation. And the third is the surety, who ensures that the principal’s obligations will be performed.

Through a bond contract, the surety agrees to uphold the contractual promises made by the principal, or pay a specified amount of money to the obligee in case the principal defaults on his or her obligations. The bond demonstrates the credibility of the principal and guarantees performance of the terms of the agreement.

Because there is financial risk involved, the surety in a bond contract is usually an insurance company whose solvency is verified by private audit, government regulation, or both. The principal will pay a premium to the bonding company, usually annually, for their participation in the bond contract.