This is a list with brief explanations of some common types of insurance products that are available through different insurance companies in the US. This list is not intended to represent all available coverages. Policies and coverages vary from company to company. Requirements and coverages may vary from state to state. It is important to understand what the different policies cover. One should research and understand the coverage they need or require before purchasing any product. It is important to remember that insurance agents sell policies and may not understand what coverage is best suited for your needs. When in doubt it may be necessary to seek legal guidance to understand the differences between policies.
This is provided for information only. I wanted the opportunity to clear up misunderstandings others in my profession may have about insurance. I do not recommend any type of policy, agent, or company.
GENERAL LIABILITY
Protects business owners (the insureds) from risks of liabilities imposed by lawsuits and similar claims. Liability insurance is designed to offer insured specific protection against third party insurance claims, i.e., payment is not typically made to the insured, but rather to someone suffering loss who is not a party to the insurance contract. It can protect against loss of income in the event there is damage to the office where normal business takes place as well as compensation for loss of records, etc. In general damage caused by intentional acts are not covered under general liability insurance policies. When a claim is made, the insurance carrier has the duty to defend the insured. There is a laymen’s term used for this policy, “trip and fall,” however, the scope of a general liability policy is much more comprehensive.
OTHER LIABILITY
Liability insurance coverage protects against legal liability resulting from negligence, carelessness or failure to act causing property damage or personal injury to others. Example of coverage include Errors and Omissions, personal injury and liquor liability.
PROFESSIONAL LIABILITY
Errors and omissions policy is available for some types of unlicensed professionals against lawsuits alleging negligence or errors. It does not cover acts resulting in personal tort (Damage, injury, or a wrongful act done willfully, negligently, or in circumstances involving strict liability, but not involving breach of contract, for which a civil suit can be brought.).
MEDICAL PROFESSIONAL LIABILITY
Provides professional liability coverage for physicians and other licensed medical professionals against lawsuits alleging negligence or errors and omissions during the care of patients. This is also known as “Medical Malpractice.”
PRODUCT LIABILITY
Coverage of the liability that parties along the supply chain of a product – from the manufacturer or the store-owner – have to assume if some defect in the product sold or manufactured injures a third party or damages his or her property.
COMMERCIAL UMBRELLA LIABILITY
Provides excess limits over scheduled primary Businessowner’s Liability, General Liability, Business Auto Liability, and Employment Liability policies. In addition commercial umbrella liability steps in to replace primary coverage once the primary aggregate limits of liability have been exhausted by claims paid; and affords broader coverage for some risks and under some circumstances, than primary policies under some circumstances, than primary policies (subject to self-insured retention). It does not take the place of general liability for business but adds as a supplement to general liability.
SURETY
Surety bonds guarantee that a principal will perform a specific obligation. They are three-party contracts: the principal- the primary party who will be performing the obligation, that the oblige – the party who is the recipient of the obligation, and the surety- ensures that the obligation will be performed.
WORKERS COMPENSATION
Is a system under which employers provide insurance – and the payment of lost wages – for employees in the case of injury, disability or death resulting from workplace hazards. This insurance is not intended for independent contractors. Independent contractors must carry their own insurance.
HOMEOWNERS INSURANCE
Some examples of the protections homeowners insurance provides to homeowners include protections against damages from fire or lightning, windstorm or hail, freezing of plumbing system, and theft. It also covers the homeowner if they are found at fault in a law suit or any testament held against them. Homeowners Insurance generally does not cover intentional acts of malice or property damage. Homeowners may or may not have limited coverage for business pursuits or professional services.
PERSONAL LIABILITY UMBRELLA
Judgments amounting to thousands or even millions are being awarded by juries across the country in ever-increasing numbers. If you accidentally injure someone or damage their property, you could be the one being sued. Even though your underlying personal policies may provide substantial liability limits, it is not uncommon today for juries to award damages that exceed those limits. Personal liability umbrella does not cover business pursuits, or professional services provided or not provided.
THANK YOU
I want to thank friends who happen to be insurance agents for their help with this project. Julia Allen with Farmers’ Insurance and Elena Sadur with State Farm Insurance.
Copyright © 2012 – , Myra Nissen.
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This article was brought to you by Myra Nissen, CCH, RSHom(NA), Board Certified Classical Homeopath. Myra teaches women how to recognize their body’s unique needs and cues and uses Homeopathy to help empower women to take control of their bodies, health and well-being. Find out more, she regularly publishes articles with home care tips for health and well-being in several venues. Visit her blog www.myranissen.com/blog.