What You Should Know About Liability Insurance

The explanations and examples below are statements about insurance policies in general, and are designed merely as aids to understand the types of coverage issues that might arise under such a policy. They do not constitute a part of your insurance policy, nor do they change the duties and obligations of the insurance company under your policy. The legal duties and obligations owed to you by the insurance company are contained solely within the contents of your policy, and you should read it fully and carefully when you receive it, to make sure that you have all of the coverage you desired.

Liability insurance protects you against a claim of a customer that may arise because the customer sustains injury because of your neglect or error; or from a product that you sell. Liability insurance pays for claim investigation, your legal defense, and the amount of damages you are directed to pay an injured person by a civil court for a claim against you that is covered under the terms of your policy. The policy will also pay for damage for which you are legally liable, that you cause to the property of another person.

There is a limit of the "money damages" for bodily injury and property damage that your insurance policy will pay. The "Occurrence Limit" is the limit your insurance company will pay for all claims covered under your policy that arise due to one single incident. The "Aggregate Limit" is the limit your insurance company will pay for the total of all claims covered under your policy which occur during the period of time covered by the policy; usually one year.

Liability insurance is usually provided in parts or "components". Not all policies contain all coverage "components". The four basic components of liability coverage provided by Insurtec are: Premises Liability, Products Liability, Personal Injury Liability and Professional Liability.

Premises Liability Insurance
This coverage protects you from claims against you by a non-employee member of the public as a result of injury they may sustain because of a defective condition of the premises you own or occupy. An example might be a wet floor that causes a slip or fall.
Products Liability and Completed Operations Insurance
This coverage protects you from claims against you by a non-employee member of the public as a result of injury they may sustain because of a defective, toxic or hazardous character of a product you sell, such as lotions. Of course, the manufacturer is ultimately responsible for the safety of the product. Still, if you sell the product, you could be named in a suit for damages resulting from defect or adverse reaction to a product.
Professional Liability Insurance
This coverage protects you from claims against you by a non-employee member of the public as a result of injury they may sustain because of reliance upon your expert advice or skill. If the advice given or the skill used was below the level of competence typically observed by members within your industry, and a person is injured because they relied on your expertise or skill, and all equipment performs properly, you could be sued for damages.
Personal Injury Liability Insurance
The above liability insurance components address damages as a result of "bodily injury" to another person that is not your employee. A "personal injury" is an injury to the character, reputation or emotions of another person. This type of injury may include false arrest, wrongful detention, or invasion of private occupancy; often called invasion of privacy.

The Insurtec insurance plans include all of the above coverage components. Coverage is provided without a deductible on any liability insurance component. We provide coverage on an "Occurrence" policy form. This type of insurance contract means that if an incident occurs that would be covered under the policy, as long as the incident "occurs" (happens) during the policy period, the claim is covered regardless of when the claim is reported, assuming you reported the claim within the time frame called for in the policy after you first became aware of it. This is important if the claim relates to an injury that may take a long time to manifest itself, such as cancer.

Important: In a salon, you should insist that your insurance coverage:

Contain liability insurance provided on an "Occurrence" policy contract type
Does not include any coverage exclusion for claims which may involve any cancer
Specifically provides Professional Liability Insurance for your services as a separate coverage part integrated into the liability insurance package.

Remember, liability insurance does not respond to claims of injury made by you, any employee, or any contractor of services to your business. These claims would fall in the area of Workers Compensation Insurance and private health insurance. Insurtec does not currently offer this coverage, nor does any coverage provided under Insurtec plans provide any type of automobile liability insurance.

What you should know about Property Insurance