Commercial General Liability (CGL)

General Liability insurance is the main component in a business’ insurance portfolio. A CGL policy provides coverage for property damage or bodily injury caused by the business’ operations or products that occurs with the exception of Professional, Auto, Pollution, Worker’s Compensation, Employers and other liability issues. The three main components to a commercial general liability policy are bodily injury (BI),  property damage (PD), and personal or advertising injury (PI).

Bodily Injury

The bodily injury component of the policy provides compensation for injuries to an individual that occured on the business’ property or as a result of your business operations. For example, if someone trips on the door mat as they are coming inside your location, places their hand out to break their fall, and incurs an injury, your CGL policy will cover the medical expenses such as doctor/hospital visit’s, medication, and follow up visits as well as compensate the injured party for any wages missed due to the injury. Mental and emotional distress are also considered bodily injuries. Most lawsuits are avoided with sufficient bodily injury coverage, but if a business is sued by the injured party, the policy will cover defense costs and damages.

Property Damage

Property damage provides coverage and compensation for damage to tangible property, including all resulting loss of use of that property.” In our example from before, if that individual damages their phone during the fall, then replacement of the phone would be covered under this area of the general liability policy. Depending on the state in which you live, stolen property from an individual while on your business’ premises can also be considered property damage.

Personal and Advertising Injury

Personal injury (PI) means damage to a person’s character, reputation, or status. Advertising damages such as use of another’s advertising ideas, infringing on another’s copyright, slogan or logo may also be covered in this area of a CGL policy. A common example is that you start a promotion for an area of your business. Your marketing team decide on a catchy slogan and you start marketing using the new slogan. Two months later you get a cease and desist letter along with court papers. Turns out that catchy slogan was copyrighted by a sole proprietor in a totally different business. These policies DO NOT cover copyright infringement due to reproduction of someone else’s material without their consent.