Why You Need Liability Insurance
As lawsuits become more and more common, the need for liability insurance continues to grow as well. Liability insurance provides you with protection in the event of litigation. Without it, a single lawsuit could be enough to drive you to financial ruin, even if you are found not liable.
Insurance to Protect the Professional
If you drive or own a home, you no doubt have some form of liability insurance coverage; in most states it is mandated. If you are a professional who provides services, advice, or care for people, you need a similar type of protection. Without it, you leave yourself vulnerable to tremendous financial losses that can ruin you personally and professionally. This type of protection, also known as Errors and Omissions insurance, is used to pay for legal services you may need in the event of a lawsuit, whether frivolous or merited.
Liability Protection for Small Businesses
Professionals are not the only ones who need protection against being sued. If you are a small business owner, insurance protects against lawsuits for injury that occur on your property, from products you manufacture, and negligence on your part or the part of your employees. In addition, it provides added protection in the event that an employee files a suit that falls outside the boundaries of Workers’ Compensation.
Additional Homeowner’s Protection
While your homeowner’s insurance most likely contains some form of liability insurance, is it enough? Take a few moments to review the policy and become familiar with the monetary limits it has. If it is too low and you are sued, you stand to lose more than the amount stated. Increasing the liability amount costs only pennies on the dollar.
The most important costs that insurance will cover are legal expenses. Because litigation can drag on for months (or longer), having an insurance policy that will cover attorney’s fees and other costs that may arise protects your personal finances. In addition, should you need to settle a claim, or be ordered to pay, the insurance policy will cover those costs.
It’s important to protect yourself from the potential financial damages that could come from a lawsuit or other legal action. Keep yourself secure by making sure that you have liability insurance and that it is sufficient to cover what you stand to lose.