General liability is the foundation of business insurance. Buffer Insurance is an independent brokerage — we shop multiple carriers to find the right GL policy for your business, whether you are a contractor, retailer, consultant, or startup.
Get a Free GL Quote →General liability insurance — often called GL or CGL (Commercial General Liability) — is the foundation of business insurance. It protects your business from financial loss when you are held liable for bodily injury, property damage, or personal and advertising injury caused to a third party.
Nearly every business needs GL coverage. It pays for legal defense costs, settlements, and judgments when someone claims your business operations caused them harm. Without it, a single lawsuit could threaten your business's survival. GL also covers medical payments for minor injuries on your premises, regardless of fault — helping resolve small incidents before they become lawsuits.
A standard GL policy provides broad protection across five key areas. Each covers a different type of risk your business faces every day.
Covers injuries to third parties caused by your business operations. A customer slips on a wet floor in your office, a delivery person trips over equipment at your job site — GL pays for their medical bills, lost wages, and legal costs if they sue.
Covers damage you cause to someone else's property during your business operations. If a plumber accidentally floods a client's basement, or a mover damages furniture during a delivery, GL covers the repair or replacement costs.
Covers non-physical harms: defamation (libel and slander), copyright infringement in your advertising, wrongful eviction, invasion of privacy, and false arrest. If your marketing materials inadvertently use a competitor's copyrighted content, GL defends the claim.
Pays for minor medical expenses when someone is injured on your premises or by your operations — regardless of who is at fault. This no-fault coverage helps resolve small incidents quickly without litigation. Typical limits are $5,000 to $10,000 per person.
Covers liability arising from products you manufacture, sell, or distribute, and from work you have completed. If a product you sold causes injury after the sale, or a construction project you finished causes damage months later, this coverage responds.
Understanding exclusions is just as important as knowing what is covered. GL is broad, but it has clear boundaries. These gaps are filled by other commercial policies that Buffer can help you find.
Injuries to your own employees are excluded from GL. They are covered by workers' compensation insurance, which is required in most states. GL only covers third parties.
Mistakes, negligence, or failure to perform professional services are not covered by GL. You need Professional Liability (Errors & Omissions) insurance for these claims.
Vehicle-related liability is excluded from GL policies. If your employee causes an accident in a company vehicle, you need commercial auto insurance to cover those claims.
Damage or injury you cause on purpose is never covered by insurance. GL only covers accidental occurrences and negligence — not deliberate harm or fraudulent conduct.
GL covers damage to other people's property, not your own. Your business equipment, inventory, and building are covered by commercial property insurance — often bundled into a BOP.
The short answer: virtually every business. Whether you have a storefront, work from home, or operate on client job sites, GL coverage is either required or practically essential. Here is why.
Most commercial leases require tenants to carry GL coverage and name the landlord as an additional insured. You cannot sign a lease without it.
Many clients — especially larger companies and government agencies — require vendors and subcontractors to carry minimum GL limits before awarding work. No GL, no contract.
Many states require contractors, tradespeople, and certain professional service firms to carry GL insurance as a condition of licensure. Operating without it can result in fines or license revocation.
Trade shows, festivals, markets, and vendor agreements almost always require proof of GL coverage. If you sell products or services in person, you will be asked for a Certificate of Insurance.
Even without a contractual requirement, a single lawsuit can cost tens or hundreds of thousands of dollars in legal fees alone. GL is the most cost-effective way to protect your business from catastrophic financial loss.
The standard general liability policy uses a $1,000,000 per-occurrence limit and a $2,000,000 general aggregate limit. Here is what that means and what drives your cost.
| Limit Type | Typical Amount | What It Means |
|---|---|---|
| Per Occurrence | $1,000,000 | The maximum the insurer pays for any single claim or incident, including legal defense and settlement costs. |
| General Aggregate | $2,000,000 | The total maximum the insurer pays for all claims combined during the policy period (usually one year). |
| Products/Completed Ops Aggregate | $2,000,000 | A separate aggregate limit specifically for claims arising from your products or completed work. |
| Personal & Advertising Injury | $1,000,000 | Per-person or per-organization limit for defamation, copyright infringement, and similar non-physical claims. |
| Medical Payments | $5,000 – $10,000 | Per-person limit for no-fault medical expenses for minor injuries on your premises or from your operations. |
A roofing contractor pays significantly more than a marketing consultant. Your industry classification code determines your base rate.
Higher revenue generally means more customer interactions and higher risk exposure, which increases your premium.
Premiums vary by state and even by city. Areas with higher litigation rates or more regulatory requirements cost more.
A clean claims record keeps your rates low. Prior claims signal higher risk and lead to higher premiums or coverage restrictions.
More employees means more exposure — more people interacting with customers, working on job sites, and creating potential liability situations.
Higher limits cost more. Choosing a higher deductible can lower your premium but increases your out-of-pocket cost per claim.
Many small businesses can save money and get broader protection by bundling GL into a Business Owner's Policy. Here is how they compare.
| Feature | Standalone General Liability | Business Owner's Policy (BOP) |
|---|---|---|
| General Liability | Included — bodily injury, property damage, personal/advertising injury, medical payments. | Included — same GL coverage as a standalone policy. |
| Commercial Property | Not included. Must be purchased separately to cover your building, equipment, inventory, and furnishings. | Included — covers your business property, equipment, inventory, and tenant improvements. |
| Business Income | Not included. If a covered event shuts down your business, you have no income replacement. | Included — replaces lost income and covers ongoing expenses if a covered event forces you to close temporarily. |
| Cost | Lower upfront cost since it covers only liability. | Often cheaper than buying GL + commercial property + business income separately. Bundling saves most small businesses money. |
| Best For | Home-based businesses, sole proprietors with minimal physical assets, or businesses that already have property coverage elsewhere. | Small to mid-size businesses with a physical location, equipment, inventory, or leased space. The most popular choice for Main Street businesses. |
Straightforward answers to the questions we hear most from business owners evaluating their liability coverage.
General liability is the starting point. These policies fill common gaps and build a complete risk management program for your business.