General liability insurance covers your business against third-party claims of bodily injury, property damage, and advertising injury. For most Georgia small businesses, it is the foundational commercial coverage, the starting point before any other policy is considered.
What general liability covers
Bodily injury coverage pays when a third party is physically injured and your business is legally responsible. If a customer slips on your wet floor, trips over equipment at your job site, or is hurt by a product you manufactured, your general liability policy responds. It pays for medical expenses, legal defense, and any settlement or judgment up to your policy limits.
Property damage coverage pays when your business operations cause damage to someone else’s property. If a contractor accidentally breaks a client’s window, a cleaning crew damages furniture, or a delivery driver backs into a parked car, property damage liability pays for the loss.
Personal and advertising injury covers non-physical claims including libel, slander, copyright infringement in your advertising, and wrongful eviction. These claims are increasingly common and often overlooked when buying general liability coverage.
What general liability does not cover
General liability does not cover your own property, your employees, professional errors, or intentional acts. If a fire destroys your equipment, that is a commercial property claim. If an employee is injured, that is workers compensation. If a client sues you for giving bad advice or making a professional mistake, that is a professional liability claim. General liability is specifically third-party liability arising from your business operations, nothing else.
One common gap worth noting: general liability does not cover damage to property in your care, custody, or control. If a contractor is hired to renovate a client’s kitchen and accidentally damages the client’s cabinets while working, that is a care-custody-control exclusion situation. Contractors need to understand this exclusion and address it specifically, often through an inland marine or installation floater policy.
How much general liability do Georgia businesses need
Most Georgia small businesses purchase $1 million per occurrence and $2 million aggregate as their standard general liability limit. Many commercial leases require at least $1 million per occurrence. Contracts with larger clients often require $2 million per occurrence or higher. For businesses with significant public foot traffic, high-hazard operations, or large client contracts, $2 million per occurrence with a $4 million aggregate is worth considering. The incremental cost between $1 million and $2 million per occurrence is often modest.
General liability versus business owners policy
A business owners policy packages general liability with commercial property insurance. If your business has physical assets worth insuring, a business owners policy is typically cheaper and broader than buying general liability and property separately. If you are a service business with no significant physical assets operating out of a client’s space, standalone general liability may be more appropriate. The structure depends on your specific risk profile.