Commercial General Liability (CGL) insurance - Full Form, Meaning, Cost and Coverage

What is CGL Insurance in India?

CGL Insurance protects businesses against liabilities requiring them to pay compensation for third party damages and injuries due to their routine business activities. The policy safeguards organization against both public liability and product liability claims.

It is highly recommended for businesses with physical premises, contractual requirements with clients and those who interact closely with third parties

Understanding Commercial General Liability (CGL) Insurance

Commercial General Liability (CGL) Insurance covers both Public Liability and Product Liability relating to third parties. Public Liability covers any third party injury/ damage occurring at the insured’s premises.

Product Liability protects against damages arising from a manufactured product.

CGL insurance offers various levels of coverage. These policies often include premises coverage, which safeguards businesses against claims arising from incidents that occur at their physical location during regular operations.

They may also provide coverage for bodily injury and property damage resulting from products or services rendered at off-site locations.Insurance providers also offer excess liability coverage for large entities, which can be purchased to protect businesses in the event of claims that exceed the limits of their CGL policy.

Certain commercial general liability policies may have exclusions that limit the actions covered.

Why Should You Buy CGL Insurance?

It is essential for your business to be covered by CGL Insurance if you’re in any of these situations;

1. A business with physical premises where there is frequent third party presence

2. A business where employees are visiting third party premises

3. A contractual requirement by vendors/ customers to purchase CGLIt aids in complying with various legal statutes.

It is also common practice for clients to request that businesses carry CGL insurance coverage prior to establishing a business partnership. Many clients impose the condition of adequate insurance coverage on their suppliers or partners in order to protect themselves against potential liabilities stemming from the business relationship.

Furthermore, clients may require businesses to include them as additional insured parties on the CGL policy. This ensures that the client is afforded coverage under the policy for any liabilities arising from the business operations.

By mandating CGL insurance, clients can mitigate their own risk exposure and safeguard themselves against potential financial losses.

Following are the steps to file a CGL insurance claim;

1. Initiate contact on priority with the Plum team to report the incident.

2. Plum works promptly with the insurer partner and subsequent course of action is determined.

3. In collaboration with Plum and the insurers, an investigator is designated to assess the severity and analyse the details of the incident.

4. Expert guidance on containment measures to prevent the situation from worsening further is provided.

5. The Plum team aids you in comprehending the necessary documentation, which includes records on the extent of the impact, the actions taken for remediation, and any direct expenses incurred during the claims procedure.

6. Following an in-depth analysis of the documentation, the survey report is created.

7. Plum maintains a strong liaison with the insurer and policyholder throughout the claim approval process.

Documents Required for CGL Insurance Claims

Each claim situation is unique to the business and the incident.Following are the typically required documents when it comes to filing a general liability claim;

1. Claim form

2. Document with an explanation of the type of claim, extent of loss, location of the loss, etc

3. Medical certificates in the event of bodily injury/ illness or death

4. Other relevant proof or documents required by the insurer

How Much Does Commercial General Liability Insurance Cost?

The pricing of CGL insurance is influenced by various factors, such as the nature and scale of your business, the geographical location, and the desired coverage level.

Plum understands the intricacies of CGL Insurance costs and business vulnerabilities. In order to simplify and make the process transparent, we have developed the Plum Business Policy Engine.

Our engine offers you valuable insights into policies suitable for businesses similar to yours, along with estimated expenses.