Protect,Your,Business,General,Liability,Insurance,Michigan,Contractors
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Contractors: Shield Your Business with General Liability Insurance in Michigan
As a contractor in Michigan, you're constantly exposed to risks that can threaten your financial well-being. From accidents on job sites to lawsuits alleging negligence, protecting your business is paramount. General liability insurance provides a safety net against these potential disasters.
Why You Need General Liability Insurance
Unexpected events can arise at any moment, leaving you vulnerable to claims from third parties. General liability insurance covers expenses such as medical bills, property damage, and legal fees if someone is injured or their property is damaged during your work. It also protects you from lawsuits alleging negligence, defamation, or other covered incidents.
Target of General Liability Insurance
General liability insurance is designed to protect contractors from legal and financial consequences resulting from claims:
- Bodily injury: Injuries sustained by individuals during your work
- Property damage: Damage to property caused by your negligence
- Lawsuits: Allegations of negligence, defamation, or other covered incidents
Key Points
- General liability insurance shields contractors in Michigan from financial risks associated with accidents and lawsuits.
- It covers expenses like medical bills, property damage, and legal fees.
- General liability insurance protects against claims of bodily injury, property damage, and various legal allegations.
- Contractors should consider obtaining general liability insurance to mitigate financial risks and ensure the longevity of their businesses.
What is General Liability Insurance for Contractors in Michigan?
General liability insurance (GLI) safeguards contractors against claims arising from accidents, injuries, or property damage caused during their work. It covers a wide range of risks, including:
Bodily Injury
If an individual sustains injuries on a contractor's job site or due to the contractor's negligence, GLI provides coverage for medical expenses, lost wages, and other related costs.
Property Damage
GLI also covers damage to third-party property caused by a contractor's actions or equipment. This includes damage to neighboring properties, vehicles, or structures.
Personal and Advertising Injury
Coverage extends to claims for defamation, copyright infringement, or false advertising that could harm a contractor's reputation or business.
Example
A contractor accidentally damaged a client's newly installed landscaping during a construction project. The client claimed $10,000 for the damages. The contractor's GLI covered the repair costs, saving them from significant financial loss.
Why is GLI Required for Contractors in Michigan?
The Michigan Construction Code requires contractors to have GLI coverage of at least $1 million per occurrence and $2 million in the aggregate. This ensures that contractors have adequate protection against potential claims.
Benefits of GLI for Contractors
GLI offers numerous benefits for contractors:
Financial Security
GLI provides peace of mind by protecting contractors from catastrophic financial losses.
Client Trust
Clients are more likely to trust contractors who maintain GLI, as it demonstrates their commitment to safety and professionalism.
Legal Compliance
Maintaining GLI is a legal requirement for contractors in Michigan, helping them avoid penalties or license revocation.
Competitive Advantage
Contractors with GLI can gain a competitive edge in the marketplace by offering clients enhanced protection.
Exclusions from GLI Coverage
While GLI provides comprehensive coverage, certain exclusions apply:
Intentional Acts
GLI does not cover injuries or damages caused by deliberate or reckless actions of the contractor.
Contractual Obligations
Claims arising from breaches of contract are not covered by GLI.
Workers' Compensation
Injuries or illnesses sustained by the contractor's employees are covered by workers' compensation insurance.
Choosing the Right GLI Policy
Contractors should consider the following factors when selecting a GLI policy:
Coverage Limits
Determine the appropriate coverage limits based on the size and complexity of the contractor's projects.
Deductibles
Choose a deductible that balances affordability with adequate coverage.
Exclusions
Review the policy's exclusions to ensure it covers the risks most relevant to the contractor's business.
Maintaining GLI Coverage
Contractors must maintain active GLI coverage throughout the duration of their projects. Failure to do so could result in legal consequences or financial penalties.
Advice for Contractors
Contractors should consult with an experienced insurance agent to discuss their specific GLI needs. Additionally, they should:
Document All Incidents
Keep detailed records of any incidents that could potentially lead to a claim.
Cooperate with Insurance Company
Provide the insurance company with prompt notice of any claims and actively participate in the claims process.
Review Coverage Regularly
As the contractor's business changes, it is essential to review and adjust GLI coverage accordingly.
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