Does My LLC or Company Need General Liability Insurance?

liability insurance for llc

As an entrepreneur, you likely decided to start your business as a Limited Liability Corporation. Operating your business as an LLC can help protect your personal assets and provide other unique benefits that your company would likely not qualify for if it was classified as a corporation. However, you need to avoid the mistake of neglecting insurance. Here is a look at several reasons why LLC insurance is an asset.

  • Exploring LLC Insurance Coverage

Professional liability insurance covers you if you make a mistake or if you are dealing with untrue allegations. The policy covers you against allegations that you caused damages while operating your business. You are also protected if you are sued because of your employees’ mistakes. Liability insurance can help secure the future of your business. Without coverage, you will be held fully responsible for any damages that occur.

  • Why Liability Insurance for LLC Is Important

Secure Your Assets

LLC insurance protects your personal assets and prevents them from being used as collateral if your business is involved in litigation. This gives you peace of mind that you cannot lose your home or automobile if your business is sued.

Accidents can happen at any time. If you don’t have liability coverage, your business could be in serious trouble if someone slips and injures themselves on your property. If they suffer bodily harm, your business will be held liable for all of the costs related to their injuries. This puts all of the assets related to your business, such as cash, equipment, and accounts receivable, in jeopardy as you look for ways to compensate the injured party. Remember that you may be sued even if your employee causes damages. LLC insurance is a safety net because it prevents you from fighting litigation on your own.

Covers You During Personal Situations

LLC insurance coverage helps protect you in personal liability disputes. Make sure that you keep your personal assets and business assets separate. If you personally guarantee a business loan and something goes wrong, your personal assets may be included in the lawsuit. Avoid illegal activity at all costs. Even if you don’t know that your behavior was illegal, your personal items are still at risk if you are sued.

Manage Litigation Costs

LLC insurance coverage is an asset during litigation. Even if you are innocent, a lawsuit comes with certain financial repercussions. During the litigation process, you will have to hire a lawyer. You’ll also need to take time away from your job to fight the charges. The reputation of your business may also be damaged. LLC insurance is the only way to manage litigation costs and fully protect your personal and business assets. The policy covers more than injuries to your customers. You are also protected if one of your employees suffers an injury in the workforce. LLC insurance also covers your business against allegations of slander.

  • Evaluate Your Risk Tolerance

Operating a business increases the risk that you will face litigation at some point. It doesn’t take much to file charges. Think about the hassle of fighting these charges on your own and all that you might lose. Remember that LLC insurance coverage is important in building the foundation of your business.

As you evaluate the benefits of LLC insurance coverage, contact the experts at Udell Family Insurance. We will help you find the coverage that you need.

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