Video Transcript

My name is Jared Morgan with Bradshaw and Will. I'm an insurance agent, and we're going to discuss how to buy general liability insurance. First you may be required to buy liability insurance as part of a job. If you're a sole proprietor or if you are a business, a small business especially, as you start dealing with other businesses in many cases they're going to require you to have liability coverage in order to purchase or in order to complete your contract or do business with you. To purchase insurance, you may be starting with liability because you have to but what you want to make sure you do is that you line up your insurance with your exposure and that you're not just purchasing one portion because it's required by a job. You may find out after you have a loss that you should have gotten some other types of insurance as well but all you asked for was liability coverage. So talk with an independent agent that can help you. Now on that note, who do you buy liability insurance from? Well you can buy from different types of agents, an independent agent is an agent who represents multiple insurance companies as opposed to a captive agent like State Farm or Allstate or a Farm Bureau agent who only represents the company that they, one company that they directly work for. So an independent agent in most cases is going to have a better idea of your exposure and will help you place your liability coverage with the appropriate company for your type of business. Now on top of that, how do you buy it? Well your insurance, your liability insurance is going to be rated on exposure. That exposure may be your payroll. It may be the square footage of your building, it may be your gross sales for the year or gross receipts or income or it may be units. For example a church's liability insurance will be rated on its square footage, a contractor's liability insurance on the other hand will be based entirely around payroll and if you're a contractor and you're looking for liability insurance and you're a sole proprietor with no employees, you will have a minimum payroll that they will use to develop your liability costs. So when you're purchasing liability coverage I would encourage you to look for someone who understands your business and is a specialist and those folks who understand what you do best as an agent, will be able to properly insure you and additionally you may need to purchase excess liability also called umbrella liability which is an additional limit above your per loss limit that will apply and just briefly, per loss, there's two limits you want to pay attention to. First you have a limit per loss and most insurance would be a million dollars per loss and then you have a limit per year and that would be considered an aggregate per year. So you have a per loss of a million and say your per year limit is two million, you're going to see two limits on general liability insurance in most cases. So my name is Jared Morgan. We've been discussing how to purchase general liability coverage.