Liability insurance is a popular and cost-effective option compared to full coverage insurance. It covers losses of the other party, not the insured person or property. Different types of liability insurance include general liability, D&O liability, employer’s liability, and professional liability.
There are many different types of insurance policies available, but liability insurance is one of the most popular because it costs so much less than many other options. For example, when it comes to auto insurance policies, it costs much less than full coverage. The reason for this is because full coverage insurance must pay for both your vehicle and any other vehicles involved in a collision, as well as property damage and medical expenses due to injuries to you or another party.
On the other hand, liability insurance is only responsible for the losses of the other party. Your person and property are not protected, but the insurance protects you from being responsible for the other party’s damages.
There are different types of liability insurance, including general liability, that cover businesses. General liability protects a business from third party claims. In addition to general liability, there is also liability insurance for damages, employer’s liability and professional liability.
D&O liability stands for “directors and officers” liability and is intended to cover the acts or omissions of those in the position of director or officer. An entire company should not be held responsible for the statements, actions, inaction or other errors that are the responsibility of one officer or director.
Employer’s liability is also known as worker’s compensation, and is a mandatory form of liability insurance coverage that all businesses are required to carry. While it appears to be intended to protect the employee, which it does to some degree, it is actually protection for the employer in the event of injury, work-related illness, or other damages for which the employee could sue the company. .
Professional liability is similar to malpractice insurance, although the coverage may not be as comprehensive as some malpractice policies in different fields. The purpose of professional liability insurance is to protect those seen as professionals or “experts” in a given field, who may not be protected by general liability due to their expertise. When one is viewed as a professional, they are held to a higher standard and are therefore often seen as having a greater responsibility towards their clients. Consequently, you need more coverage than general liability insurance offers.
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