General liability pays for third-party bodily injury, property damage and personal and advertising injury claims, and it is required by nearly every lease, vendor agreement and construction contract. This guide explains what it covers, what it leaves out, what drives the price and how to check that your policy matches the contracts you sign.
Insurance that pays defense costs and damages when someone outside your company says your business, products or operations hurt them or damaged their property.
Who needs it
Almost every business. Landlords, customers, lenders and event venues routinely require proof of it before you can sign.
Biggest pitfall
Assuming it covers everything. It does not cover professional or technology errors, employee injuries or your own property, and a policy that lacks the additional insured or waiver wording a contract requires can stall a deal.
What drives price
Your class of business, revenue or payroll, locations, products, subcontractors, the limits you choose and your claims history.
Typical spend
It varies widely by class. Many low-hazard, office-based businesses pay a modest premium, while construction, products and high-hazard operations cost far more.
The basics
What is general liability insurance, in plain English?
General liability, often called commercial general liability or CGL, is the policy that responds when someone who is not your employee claims your business harmed them. A customer slips in your office. A contractor’s work damages a client’s equipment. A marketing campaign is accused of using someone else’s photo. In each case the policy pays the legal defense and, up to the limit, the settlement or judgment.
The easiest way to place GL is by what was harmed. If the harm is physical injury or property damage, or a claim about your advertising, it is a GL question. If the harm is financial loss from your advice or software, it is an E&O question. If an employee is hurt, it is workers’ compensation.
GL is also a contract document. Leases, vendor agreements and customer contracts usually specify minimum limits and wording, such as additional insured status and a waiver of subrogation, and a certificate of insurance has to show it. Getting the form right matters as much as getting the limit right.
Who needs it
Who needs general liability, and when?
Short answer: almost every operating business needs it, usually earlier than founders expect, because the first lease, customer contract or event booking asks for proof. The need rises with foot traffic, physical products, field work and the number of contracts that name insurance requirements.
Where you are
Do you need GL?
Why
Remote team, no office, software only
Often yes, because contracts ask for it
Few people can be injured by you in person, but enterprise customers and coworking or event hosts often require GL before signing. A short conversation about what you actually do settles it.
Signing an office lease or a coworking agreement
Yes, expect it as a condition
Landlords require liability coverage and usually want to be named on it. Check the required limits and wording before you sign, not after.
Physical products can injure people or damage property after they leave your hands. Products and completed operations coverage, and sometimes a separate product liability policy, handles that exposure.
Installing, repairing or working at customer sites
Yes, and ask about subcontractors
Your people are working inside someone else’s property, so damage and injury claims are more likely. Contractors and subcontractors raise the stakes.
Hosting events, offsites, demo days or trade-show booths
Yes, often as a one-off requirement
Venues commonly ask for a certificate naming them. Alcohol, crowds and rented space can change which policy responds.
Hiring subcontractors or freelancers for physical work
Yes, and collect their certificates
If a subcontractor is uninsured, claims can come back to you and your premium can reflect it.
Rule of thumb
Buy GL before the first signature that asks for it. A certificate is much easier to obtain on your timeline than on the landlord’s.
Scope
What general liability covers, and what it doesn’t
What’s Covered
Bodily injury to third parties at your premises or caused by your operations
Damage to other people’s property caused by your business or your work
Products and completed operations claims, when a product or finished work causes harm
Personal and advertising injury, such as defamation, privacy violations and copyright infringement in your advertising
Medical payments for minor injuries, regardless of fault
Legal defense, which standard forms generally pay in addition to the policy limit
What’s NOT Covered
Most general liability policies exclude:
Errors in professional services or software, which belong on E&O or technology E&O
Injuries to your own employees, which belong on workers’ compensation
Employment claims such as wrongful termination, which belong on EPL
Damage to your own property or equipment, which belongs on property insurance
Data breaches and cyber events, which belong on cyber insurance
Auto accidents, pollution and intentional acts, which are excluded or covered separately
How the policy is built
What are the parts of a general liability policy?
Short answer: a standard commercial general liability form has three insuring agreements: bodily injury and property damage, personal and advertising injury, and medical payments. Defense costs, supplementary payments and a list of exclusions and conditions sit around them. Wording varies by carrier and form, so confirm yours.
Bodily injury and property damage
The core of the policy. It responds when your business, products or work cause physical injury to someone else, or damage to or loss of use of their property, from an accident that happens during the policy period.
Why it matters: Most contract requirements and most claims live here. The word “occurrence” in the form is what decides which year’s policy responds.
Personal and advertising injury
Covers a defined list of offenses, commonly including defamation, invasion of privacy, wrongful eviction and certain infringement in your advertising. It is not a general intellectual property policy.
Why it matters: Marketing teams create these claims. Read the list of offenses and the exclusions that sit next to it.
Products and completed operations
Covers injury or damage that happens after your product has left your control or your work is finished, away from your premises. It usually carries its own aggregate limit.
Why it matters: For hardware companies and installers this can be the largest exposure, and some forms restrict it for certain products. Ask directly.
Medical payments
Pays modest medical expenses for people hurt on your premises or by your operations, regardless of fault, usually at a low limit and often within a short reporting window.
Why it matters: It can resolve a small injury quickly before it becomes a lawsuit, but it never replaces the main liability coverage.
Damage to premises rented to you
A limited form of cover when you are legally liable for fire or similar damage to space you lease, usually at its own, smaller limit.
Why it matters: Landlords often want more than the standard sublimit. Ask whether a higher limit is available.
Defense and supplementary payments
The insurer typically has a duty to defend covered suits and, on standard forms, pays defense costs in addition to the limit, along with certain bond and interest costs. Read the form to confirm. See duty to defend and defense costs.
Why it matters: Some specialty forms put defense inside the limit, so the same limit can buy less protection.
Which policy responds?
GL vs. property, umbrella and professional liability
Short answer: GL answers for injury and damage to other people and their things. Your own property goes to property insurance, large liability losses can spill into an umbrella, and financial loss from your advice or software goes to professional or technology E&O. Claims rarely arrive labeled, so this table maps common situations.
Scenario
GL
Property
Umbrella
Professional / E&O
A customer trips on a cable at your office and breaks an ankle
Covered
No
Only if the claim exceeds the GL limit
No
A fire in your office destroys your own laptops and furniture
No
Covered
No
No
Your installer floods a customer’s server room
Covered
No
Only if the claim exceeds the GL limit
No
A device you sold overheats and burns down a buyer’s apartment
Covered, if products coverage applies
No
Only if the claim exceeds the GL limit
No
Your ad campaign is accused of using a photographer’s image without permission
May respond, under advertising injury
No
No
No
A customer sues because your software was down for two days
Short answer: GL is written on an occurrence basis: the policy in force when the injury or damage happens responds, even if the claim is filed years later. The per-occurrence limit caps what the policy pays for any one event, and the general aggregate caps what it pays across the whole policy period.
The incident happens
A visitor is hurt, or a product causes damage, while Policy A is in force.
Year 1
Coverage changes
Policy A ends and Policy B begins. You may even change brokers or carriers.
Year 2
The claim arrives
Policy A, not Policy B, is the one that responds, because that is when the occurrence happened.
Year 3
Rule of thumb
Keep every old GL policy and its certificates. Because GL is occurrence-based, an old policy can be the one that responds years from now.
The comparison with claims-made coverage, which D&O and E&O use, is the single most common point of confusion. For GL, the date of the event matters, not the date of the claim. See occurrence policy for the formal definition.
Limit
What it caps
What to check
Each occurrence
The most the policy pays for all damages from one event
Contracts usually name a minimum for this limit. The standard starting point is $1 million per occurrence.
General aggregate
The most the policy pays across the policy period for most claims
The standard is $2 million. It is eroded by claims, so one bad year can thin protection for the rest of the term. See general aggregate.
Products and completed operations aggregate
A separate cap for claims arising from finished products or work
It is usually separate from the general aggregate, but forms differ.
Personal and advertising injury
The most for any one person or organization harmed by those offenses
Often equals the per-occurrence limit, though it is stated separately.
Medical payments and rented-premises damage
Small sublimits for minor injuries and for damage to space you lease
Landlords sometimes ask for more than the standard rented-premises sublimit.
What does a per-location or per-project aggregate do?
It gives each location or each job its own aggregate, instead of one shared aggregate for the whole policy. Contractors and companies with several sites often need it in the contract.
Why it matters: Without it, a claim at one location can use up the aggregate that your other locations and jobs rely on.
When does an umbrella make sense?
An umbrella or excess policy sits above the GL limit and can respond when a claim exceeds it, subject to its own terms and the underlying policy.
Why it matters: Many enterprise contracts ask for limits above the GL minimum, and an umbrella is the usual way to meet them.
Where it surprises people
Common GL exclusions that surprise tech companies
Short answer: the exclusions that catch technology companies off guard usually point to a different policy rather than a flaw in the GL form: professional services and software errors, data and cyber events, employee injuries, and contractual promises beyond the policy’s own coverage. Check each against what you actually do.
Professional services and technology errors
Many GL forms exclude or limit claims that arise from rendering professional services, and software failure usually produces financial loss rather than injury or damage.
Why it matters: A customer suing over an outage belongs on technology E&O, which is why the scenario below pays nothing from GL.
Data, electronic records and cyber events
Many current forms exclude loss of or damage to data, and access-or-disclosure of confidential information. Cyber losses belong on cyber insurance.
Why it matters: A data incident is a common claim for technology companies and GL is not built for it.
Employee injuries and employment claims
The employer’s liability exclusion removes injury to your own workers, and employment-related practices are typically excluded as well.
Why it matters: These belong on workers’ compensation and EPL, and a missing workers’ comp policy is a problem that GL cannot fix.
Contractual liability beyond an “insured contract”
GL typically covers liability you assume in certain kinds of contracts, such as a lease or an indemnity for injury. It does not cover every promise a contract can make.
Why it matters: Customer paper sometimes asks for indemnities broader than what GL will back. Have the policy read against the contract.
Your own products and work
Typical forms exclude the cost of repairing or replacing your own product or your own faulty work, and recalls, even though harm to others caused by them may be covered.
Why it matters: GL is not a warranty or product-recall policy.
Intellectual property beyond advertising
Patent, trade secret and most trademark claims are generally excluded, with limited advertising-related offenses covered.
Autos, aircraft, watercraft, pollution and alcohol
These usually need their own policies or endorsements. Liquor liability exclusions often apply to businesses that sell, serve or furnish alcohol.
Why it matters: Offsites and events that serve alcohol are a place where assumptions fail.
Independent contractor and injured-worker claims
Some forms exclude injury claims brought by employees of contractors or by independent workers (often called action-over claims), or require proof of contractor insurance first.
Why it matters: If you hire contractors or gig-style workers, ask about this exclusion before you sign a customer contract that assumes full GL protection.
Short answer: the endorsements contracts ask for are additional insured, primary and non-contributory, and waiver of subrogation, plus per-location or per-project aggregates and certificate-related wording. They change who is protected and in what order, so confirm each is attached to the policy, not just mentioned on a certificate.
Additional insured
Extends the policy’s protection to another party, such as a landlord or customer, for claims arising from your operations. See additional insured.
Why it matters: Contracts often ask for it by endorsement form, and which form is attached determines what the other party actually gets.
Primary and non-contributory
Says your policy pays first and the other party’s own insurance does not have to contribute. See primary and non-contributory.
Why it matters: Without it, a customer’s insurer can argue that both policies share the loss.
Why it matters: It is a routine contract request, but it gives up a right, so it is worth confirming that your carrier allows it and what it costs.
Blanket additional insured and blanket waiver
Applies to every party you have promised in a written contract, instead of naming each one individually.
Why it matters: It can save time and reduce errors if you sign many contracts, though carriers may price or limit it.
Per-project or per-location aggregate
Gives each job or site its own aggregate limit, as covered above.
Why it matters: Contractors and multi-site companies often need it for the contract to be satisfied.
Notice of cancellation to certificate holders
Some contracts ask the carrier to notify the certificate holder if the policy is cancelled.
Why it matters: Not every carrier offers it, and a certificate on its own does not create the obligation.
Higher damage-to-rented-premises limit
Raises the sublimit for fire or similar damage to space you lease.
Why it matters: Useful when a lease asks for more than the standard sublimit.
Contracts and certificates
How customers and landlords ask for proof of GL
Short answer: they send a contract clause or an insurance schedule that lists required coverages, limits and endorsements, and then ask for a certificate of insurance. A certificate summarizes coverage but does not change it. The policy and its endorsements are what actually govern a claim.
The contract arrives
An insurance clause or schedule lists limits, additional insureds and waiver wording.
Step 1
Check against your policy
A broker compares each requirement with the policy and endorsements already in place.
Step 2
Fix gaps
Endorsements are added or limits raised where the policy falls short.
Step 3
Certificate issued
A certificate and, if asked, endorsement copies go to the counterparty.
Send the insurance clause to your broker before you negotiate it. Wording is far easier to change in a draft contract than after the policy has been issued.
What the contract says
What it usually means for the policy
Minimum limits per occurrence and aggregate
Your GL limits, and sometimes an umbrella, have to meet or exceed the numbers listed.
Name us as additional insured
An additional insured endorsement must be attached, often on a specific form.
Primary and non-contributory
A separate endorsement or wording confirms that your policy responds first.
Waiver of subrogation in our favor
A waiver endorsement has to be attached, which the carrier may have to approve.
Certificate delivered before work starts
Plan for turnaround. Request the certificate as soon as the contract is final.
When things change
What happens to GL as your business changes?
Short answer: GL is usually rated on revenue or payroll and tied to a description of operations, so growth, new locations and new services can all change both the premium and whether a claim is covered. Tell your broker about changes before they happen.
Event
What typically happens
What to do
Revenue grows
Premium often adjusts at an audit after the term, and a larger business may need higher limits
Share a realistic revenue forecast at renewal, so the audit is not a surprise.
You open a new office or a second location
The policy may need the location added, and a per-location aggregate may become relevant
Report it before the lease starts, and update any landlord requirements.
You add a new service or product line
A new activity can fall outside the class on the policy or hit an exclusion
Update your description of operations in writing.
You begin using subcontractors
Underwriters may ask for their certificates, or charge for uninsured subcontractors
Collect certificates and contract language before work starts.
You make a claim
The insurer investigates and may reserve its rights. Your experience at renewal reflects the outcome
Report quickly, in writing, and keep records. A loss run will be asked for later.
You change carriers or let GL lapse
Occurrences before the change are still covered by the old policy; occurrences during a gap are not covered by anyone
Avoid a gap, and keep the old policy and certificates.
You wind down
The policy ends at cancellation or expiry, and claims for earlier occurrences can still be brought
Keep records, and ask your broker how the old policies would respond.
What claims look like
Three GL claims, and one it would not pay
Scenario 01
The slip at the client meeting
What happenedA visitor slipped on a wet floor in a company’s office lobby and fractured a wrist.
The claimBodily injury claim against the company for medical costs and lost income.
What respondedPremises liability coverage paid the defense and a negotiated settlement, after the deductible, up to the per-occurrence limit.
Scenario 02
The installation that flooded a server room
What happenedA company installing equipment at a customer’s site accidentally damaged a water line, flooding the room below.
The claimProperty damage claim from the customer and its landlord.
What respondedThe policy paid for the damage and the defense, because the loss came from the company’s operations at a third party’s location.
Scenario 03
The software outage that GL did not cover
What happenedA software company’s platform failed for two days. A customer sued for lost revenue, alleging breach of contract.
The claimA financial loss claim with no bodily injury or property damage.
What respondedGeneral liability did not respond. A technology E&O policy is the coverage built for this claim, which is why most tech companies carry both.
Scenarios are illustrative composites based on common claim patterns, not specific Alton Risk clients. Whether a real claim is covered depends on the policy wording and the facts.
Pricing
What moves the price of general liability?
Two businesses of the same size can pay very different premiums, because carriers rate GL on how likely your operations are to hurt someone and how costly that would be.
Factor
Why it moves your premium
Class of business
The type of work you do is the starting point. Office-based operations rate lower than construction, manufacturing or anything involving crowds or heavy equipment.
Revenue or payroll
Most classes are rated per unit of revenue or payroll, so a growing company pays more as it grows, and audits true it up after the term.
Locations and square footage
More locations and more public foot traffic mean more premises exposure.
Products and completed work
Selling physical products or doing work that lasts after you leave adds products and completed operations exposure.
Subcontractors
Using subcontractors without collecting their certificates of insurance can raise the price or lead to an uninsured-subcontractor charge.
Limits and deductible
The standard is $1 million per occurrence and $2 million general aggregate. Higher limits cost more, and a higher deductible lowers premium.
Claims history
Prior losses and how they were handled tell the underwriter what to expect.
Getting covered
How to get GL quoted and certificates issued
Short answer: describe what you do in plain language, have your revenue, locations and contract requirements ready, and be candid about prior claims. The online quick quote for general liability and workers’ comp at our quote page is a fully digital application, and a broker follows up with options, with timing and pricing depending on your class, state and carrier appetite.
What to have ready
Your legal entity name and any subsidiaries or locations.
A plain-language description of what you do, including anything physical or on-site.
Annual revenue or payroll, and the expected change over the next year.
Products you make or resell, and who buys them.
Subcontractors you use, what they do and whether they carry insurance.
The insurance clauses from any lease or customer contract that will be signed.
Prior policies and loss runs, if you have them.
What delays a quote or a certificate most often?
A vague description of operations, contract requirements that arrive late, and wording the carrier has not approved.
Why it matters: Each is avoidable if the contract and the application reach your broker together.
What mistakes cost businesses the most?
Describing the business too narrowly or too broadly, ignoring an exclusion that matches what you do, and letting a policy lapse between terms.
Why it matters: The cheapest quote is the one most worth reading line by line.
From the carrier’s side of the table
What underwriters ask before they quote
A GL submission is won or lost on how clearly it describes what you actually do. Underwriters rate the class you describe, so a vague description can land you in a more expensive class or a decline.
A plain-language description of operations, including anything unusual or higher-risk.
Annual revenue or payroll and the expected change over the next year.
Locations, square footage and how much space is open to the public.
Products sold, who makes them and who buys them.
Subcontractor use, what they do, what you pay them and whether you collect their certificates.
Contract requirements, including required limits, additional insureds and waiver language.
Prior carriers and claims for the last several years.
Self-audit
Questions to ask about your current policy
Is it written on an occurrence form, so it covers incidents that happen during the policy period?
Do the limits meet the highest requirement in any lease or customer contract you have signed?
Does it include the additional insured, waiver of subrogation and primary and non-contributory endorsements your contracts require?
Is the general aggregate per project or per location if your contracts expect that?
Does a professional services or similar exclusion remove coverage for something you actually do?
Is your description of operations accurate, so you are rated in the right class?
GL is required in virtually every commercial lease, vendor agreement, and construction contract. It covers claims from people who are injured at your premises, harmed by your products, or damaged by your operations.
For companies in construction and other high-exposure industries, GL placement requires specialty market access that standard brokers don't have.
General liability covers third-party bodily injury, property damage, and personal and advertising injury, for example, a visitor injured at your premises or damage caused by your operations. It is the foundation of nearly every commercial insurance program.
Is general liability insurance required?
+
GL is required in virtually every commercial lease, vendor agreement, and construction contract. You will usually need to provide a certificate of insurance before signing.
What is the difference between general liability and professional liability?
+
General liability covers physical injuries and property damage. Professional liability, or E&O, covers financial harm arising from your services or advice. Most technology companies need both.
Can you place GL for hard-to-place or high-hazard operations?
+
Yes. For classes that standard carriers decline, we access E&S and surplus lines markets directly and present the risk with the depth underwriters need to write it.
Is general liability occurrence-based or claims-made?
+
General liability is typically written on an occurrence basis, meaning the policy in force when the injury or damage happens responds, even if the claim is filed later. That differs from claims-made policies such as D&O and E&O. Keep old policies and certificates, since one of them may respond to a future claim.
What is the difference between the per-occurrence limit and the general aggregate?
+
The per-occurrence limit is the most the policy pays for any one event. The general aggregate is the most it pays across the whole policy period for most claims. Many policies start at $1 million per occurrence and $2 million aggregate, and your contracts may ask for more.
Does general liability cover a tech company?
+
It can, for physical risks such as a visitor injured at your office, damage during an on-site installation or harm from a hardware product. It usually does not cover software failure, professional errors or data incidents, which belong on technology E&O and cyber. Most technology companies carry GL alongside those policies.
What does an additional insured endorsement do?
+
It extends your policy’s protection to another party, such as a landlord or customer, for claims that arise from your operations. Contracts often name a specific endorsement form, so confirm the endorsement is attached to the policy, not only listed on a certificate. See additional insured.
What does primary and non-contributory mean?
+
It means your policy pays first and the other party’s insurance is not asked to share the loss. Customers and landlords request it so their own insurers stay out of the claim. It is normally added by endorsement, so ask for it before you sign.
What is a waiver of subrogation, and should I agree to it?
+
A waiver of subrogation stops your insurer from pursuing the other party to recover what it paid you. It is a routine contract request, but it gives up a right, so confirm with your broker that the carrier permits it and whether there is a charge before agreeing.
Does general liability cover damage to the office I rent?
+
Many policies include limited cover for damage to premises you rent, such as from a fire, at a smaller sublimit than the main limit. Your landlord may ask for more, and your own equipment and improvements belong on property insurance. Check the sublimit against your lease.
What is medical payments coverage?
+
Medical payments coverage pays modest medical bills for people hurt on your premises or by your operations, regardless of who was at fault. It typically carries a low limit and is meant to resolve small injuries quickly. It does not replace the main liability coverage.
Do I need general liability if my team is fully remote?
+
Possibly. Fewer visitors means fewer premises risks, but enterprise customers, coworking spaces, event hosts and landlords often require GL anyway, and in-person work, events or hardware can create exposure. Describe what you do, and your broker can say what contracts and operations point to.
Does general liability cover advertising and marketing claims?
+
Partly. Personal and advertising injury coverage addresses a defined list of offenses, such as defamation, privacy violations and certain infringement in your own advertising. It is not a general intellectual property or content policy, and claims about products or AI-generated output usually fall elsewhere.
What happens if my general liability policy lapses?
+
An incident that happens while the policy is in force is still covered by that policy. An incident during a gap is not covered by anyone, and contracts may treat a lapse as a breach. Renew on time and ask your broker how a late renewal would be treated.
Is a business owner’s policy the same as general liability?
+
No. A business owner’s policy, often called a BOP, is a package that commonly combines general liability with property coverage for smaller businesses. GL is the liability piece of that package, and the specific package terms and eligibility depend on the carrier.
Do I need an umbrella policy on top of general liability?
+
Not always. An umbrella adds limit above GL for large claims, and customers or lenders sometimes require higher limits than the base policy provides. It follows the terms of the underlying policy, so decide based on contracts and how serious a single claim could be.
How do I get a certificate of insurance for a customer?
+
Send the customer’s insurance requirements to your broker, who compares them with your policy, adds any needed endorsements and issues the certificate. Speed depends on the broker, the carrier and whether endorsements are needed. A certificate summarizes coverage but does not change it.
What about subcontractors and freelancers I hire?
+
If subcontractors are uninsured, claims connected to their work can come back to you, and your premium may reflect it. Collect certificates and contract terms before work starts, and ask about exclusions for injured contractor workers, sometimes called action-over claims.
Fill in a short digital application and a broker will come back with options from top carriers, aiming for the same day. Eligibility, timing and pricing depend on your class of business, your state and carrier appetite.
