Understanding Your Business’s Insurance Policy
Commercial insurance policies that help protect your business from various kinds of risk are essential for a properly functioning business. Insurance policies will pay for legal damages stemming from a lawsuit against your business, and will usually pay for the legal fees associated with hiring a lawyer and defending against a lawsuit. For this reason, it is important to understand the different types of policies that are available and what they can and cannot do. Remember, not all insurance policies are created equal. Some policies are broad, while others are specialized and cover only certain types of damage. Even broad policies will often not provide all the coverage that your business needs.
When shopping for insurance for your business, you may find that you need more than one policy for full coverage. Some commercial insurance policies pay for damage suffered by your business, whereas other policies protect your business in case it causes harm to others and lawsuits ensue. You must determine which policy (or policies) you need based on what your business does and where damage or liability could potentially come from.
Policy terms will vary. Different policies will have different limits on the amount of coverage they will provide. Policies can limit how much the insurance company will pay for each separate instance in which you invoke the policy. If your damages in a given situation exceed this limit, you will be responsible for the extra amount and will have to pay it out of pocket. For this reason it may be prudent to purchase supplemental insurance. Policies may also have a maximum coverage amount for the life of the policy. You should evaluate how much exposure to liability your business potentially has to determine how much insurance to purchase.
There are also costs associated with your insurance policies. Along with the premiums that you will pay, there may be deductibles that come with the policies. Deductibles are the amount that you must pay before your insurance coverage kicks in. This means you will have to pay part of the claims against you out of pocket even if you do have insurance coverage. You may find that, even with insurance coverage, you will be responsible for paying any small claims against you on your own if the claims are not large enough to rise above the deductible threshold.
If you have questions about your company’s insurance coverage, contact one of our experienced commercial litigation attorneys today
Make sure you have a thorough understanding of what coverage your insurance policy provides for you and any holes that there may be in that coverage. If you are unsure, have one of the experienced insurance coverage attorneys from Berkowitz Klein review your policy. The attorneys at Berkowitz Klein have been representing businesses in insurance coverage litigation in Pennsylvania and Chester County for over 25 years. You can contact Gerald Berkowitz directly by phone at (610) 889-3200.