Commercial General Liability (CGL) insurance is the foundation of every business insurance program. It covers third-party bodily injury, property damage, and personal/advertising injury claims arising from business operations, products, or premises. CGL policies are standardized using ISO (Insurance Services Office) forms, making them relatively consistent across carriers while allowing endorsements for specific needs.
Every business needs general liability insurance. It is often the first policy purchased and is required by most commercial leases, contracts, and loan agreements. Businesses with physical customer-facing locations, construction operations, manufacturing, and service delivery face the highest GL exposure. Most certificates of insurance requested by clients or landlords require evidence of CGL coverage.
CGL policies are occurrence-based, meaning they cover bodily injury or property damage that occurs during the policy period regardless of when the claim is filed. Policies include per-occurrence and general aggregate limits. Coverage is divided into Coverage A (bodily injury and property damage), Coverage B (personal and advertising injury), and Coverage C (medical payments). Defense costs are outside the policy limits.
Standard CGL limits are $1M per occurrence and $2M aggregate. Higher limits are available and often purchased for construction and hospitality operations. Deductibles are typically $0-$2,500 for small to mid-market risks. Premium is based on industry class code, revenue or payroll, and claims experience. CGL is often combined with property in a Business Owners Policy (BOP) for smaller operations.
A visitor to a retail location tripped over an extension cord and sustained a broken hip requiring surgery and rehabilitation. The general liability policy covered $45K in medical payments, $185K in the bodily injury settlement, and $60K in defense costs — all outside the policy limits, preserving the full limit for future claims.