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Liability Insurance
What is Liability insurance?
Liability insurance is a part of the general insurance system of risk financing to protect the purchaser (the "insured") from the risks of liabilities imposed by lawsuits and similar claims. It protects the insured in the event he or she is sued for claims that come within the coverage of the insurance policy. Originally, individual companies that faced a common peril formed a group and created a self-help fund out of which to pay compensation should any member incur loss (in other words, a mutual insurance arrangement). The modern system relies on dedicated carriers, usually for-profit, to offer protection against specified perils in consideration of a premium.
Why do you need liability insurance?
Liability claims can happen to anyone. While you do your best to get everything right, a minor slip-up or accident can lead to claims running into huge monetary value. If you were ever in a situation that made your company liable to be sued, having liability insurance can give you the protection you need.
What does liability insurance cover?
Your legal liability towards damages to a third party in the case of an accidental death, bodily injury or loss of or damage to property.
Legal costs and expenses incurred by you with prior consent.
Who can take the policy?
A person who owns or is in control while handling a hazardous substance at the time of accident can take the policy.
In the case of a firm, it will be liable to its partners
In the case of an association, it will be liable to its members
In the case of a company, it will be liable to it directors, secretaries, managers or other officers who are directly in charge of, and is responsible to the company for the conduct of the business of the company.
What liability insurance does not cover?
The policy does not cover liability arising from:
Willful or intentional non-compliance of any legal provisions
Damage to property owned, leased or hired or under hire purchase or on loan to the insured or otherwise in the insured owner's control, care or custody.
Direct or indirect consequence of war, invasion, civil war, revolution, rebellion, insurrection or military or usurped power
Direct or indirect result of: Ionizing radiation or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel.
The radioactive, toxic, explosive or other hazardous properties of any explosive nuclear assembly or nuclear component thereof.