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Frequently Asked Questions Regarding Business Insurance

What is a certificate of liability insurance?

A certificate of liability insurance is a snapshot of the coverage provided by the various insurance policies you have in effect at the time the certificate is generated. It cannot modify an insurance policy and it is not a contract. As such, a certificate cannot reference lines of insurance coverage and/or endorsements that are not in effect at the time of issuance.


What is an additional insured?

An additional insured is a person or entity to which liability coverage is extended at the request of the Named Insured. Typically, this is done as a result of a written contractual agreement under which the Named Insured agrees to indemnify the Additional Insured in the event of a covered liability claim. Additional Insureds do not have the right to change coverages on a Named Insured’s policy nor are they automatically provided with cancellation notices (a separate endorsement must be issued to provide this).


What is hired and non-owned auto liability?

Hired autos are vehicles that your business leases, rents, hires, or borrows for business purposes (but not borrowed from your employees). Non-owned autos used in connection with your business but are not owned, leased, hired, rented, or borrowed by the named insured. Typically, non-owned autos tend to be employee-owned vehicles that employees use for business reasons. Hired and non-owned auto liability extends liability coverage (bodily injury and property damage coverage) to vehicles that fall into either of these categories. Hired car physical damage may be purchased as an additional coverage in conjunction with hired and non-owned auto liability. This coverage provides comprehensive and collision coverage to vehicles that are considered to be hired autos.


What is a commercial umbrella?

In simple terms, commercial umbrella insurance complements your other liability coverages by taking over when your other liability coverage limits have been reached. These policies come into play when large claims occur and exhaust the limits of the primary general liability, auto liability, and/or other liability policies that are in place for an insured.


What is general liability vs. professional liability?

General liability covers risks such as bodily injury and property damage, medical payments, reputational harm, and advertising errors. Professional liability, also called errors and omissions insurance, protects your business if your client alleges financial damages from the professional service that you provide.

What is commercial property insurance, and why do I need it?

Commercial property insurance is a must-have for anyone who operates out of a physical location and this type of insurance will cover your property for direct physical losses. In addition, you can purchase business income coverage that replaces lost income in the event your business has to shut down while your property is being repaired, replaced, or rebuilt.

Do I really need business income insurance? What does it do?

How long can your company survive without doing business? Business income insurance replaces your lost income while your business is shut down due to a covered loss. In addition, this insurance may provide you with coverage for extra expenses, such as lease costs for temporary space, that will allow your business to get up and running while your permanent space is repaired or rebuilt.


What does "personal and advertising injury" mean?

This type of coverage is found within the general liability insurance form and is does not pertain to what personal injury lawyers do. Rather, this type of coverage protects you against allegations of  libel, slander, plagiarism, copyright infringement, or publication of materials violating an individual's right to privacy.

What is "claims made" coverage?

"Claims made" coverage only covers you when the insurance policy is in force, when a claim is being made, and when that claim is reported within the specified time period (either prior to the end of the policy term or prior the expiration of any extended reporting period). This differs from occurrence policies, which offer coverage for any incidents that occur while the policy was in force, regardless of when the claim is filed.

What is "prior acts" coverage?

Most insurance policies don't cover you for any incident that takes place prior to the date the policy goes active. An insurance policy that offers prior acts coverage will provide coverage for claims that occur prior to the inception date of the policy.

What's the difference between employer's liability and employment practices liability insurance?

Employer’s liability insurance provides coverage for workplace-related claims that aren’t covered by workers compensation insurance.  Employment practices liability insurance is for violations of employment law, such as discrimination, sexual harassment, wrongful termination, failure to hire, etc.


What is directors and officers liability coverage?

Directors and officers liability insurance, also known as management liability insurance, protects corporate directors and officers against allegations of mismanagement. This type of insurance has become increasingly important, as it overlaps with professional liability and even cyber liability in certain instances.

Do I need cyber insurance?

Hackers prey on businesses of all sizes and even the best cybersecurity security sometimes fails. Cyber insurance protects businesses against significant financial losses stemming from a data breach or malware such as ransomware. Cyber insurance typically includes first-party coverage, which addresses losses directly affecting your business, as well as third-party coverage, which addresses breaches or losses affecting your customers and vendors.

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