Liability insurance is a concept that is frequently discussed yet commonly misunderstood. The concept of liability applies to both commercial and personal insurance, and it recurs again and again during the claims and settlement processes.
Generally speaking, liability can be defined as “being responsible for consequences.” It can arise both from action, and from failure to take action. Liability that stems from failing to do something that you should have done is known in legalese as “negligence.”
More specifically, liability is concerned with who is financially responsible for damages arising from an accident, incident, or other situation. It’s a major reason why insurance is so important. Without liability coverage, you would be on the hook to pay out of pocket if your actions or lack of appropriate actions caused property damage, injury, illness, death, or other losses.
Alberta Liability Insurance for Drivers
In Alberta, driver must carry a minimum of $200,000 in liability coverage. However, this should only be used as a basic guideline. If you are determined to be at fault for an accident causing more than $200,000 in financial damages, your insurance company will not cover the balance above that total.
Generally speaking, the more liability coverage your auto insurance policy offers, the better. This enhances your personal financial protection, leaving you more secure in the event of an accident.
Remember, too, that standard car insurance policies include restrictions that may leave you unprotected if you’re involved in an accident while using your personal vehicle for commercial purposes. If you use your vehicle for business reasons, you’ll need additional coverage.
Alberta Liability Insurance for Businesses
Businesses have more complex needs when it comes to liability insurance. General commercial liability policies are there to protect you if you are found legally responsible for financial damages arising from:
- Accidents on your business site
- Accidents that occur on a customer’s property while you are delivering company services or products
- Illnesses or injuries caused by your products or services
These policies cover bodily injuries, medical expenses, property damage, and personal injury caused by libel, slander, or advertising.
However, general commercial liability policies are exactly that — general. Depending on the nature of your business, you may need more specific types of liability coverage. Two common examples are legal liabilities for tenants that rent residential or commercial property that you own, and liabilities arising from employee use of automobiles that you do not own.
You’ll also have more complex commercial insurance needs if you own, lease, or operate a fleet of vehicles that are used for commercial purposes. Another type of commercial liability coverage to consider is known as professional liability insurance. Also known as “errors and omissions” coverage, this kind of insurance is essential if you’re in a line of business that leaves you vulnerable to lawsuits filed by dissatisfied customers claiming that you were negligent in carrying out your professional duties.
How to Avoid Gaps in Your Liability Insurance Coverage
The best way for individuals and businesses to ensure that they don’t have any insurance gaps is to maintain a type of coverage known as umbrella insurance. As the name suggests, umbrella insurance policies are products that serve as a “catch-all” for situations not specifically covered by the various types of insurance you’re already carrying.
For a more in-depth overview of what umbrella insurance is and how it protects you, please refer to our previously published article on the topic, available here.
Trust Lane’s for Helpful Advice on Liability Insurance
Lane’s Insurance is staffed by some of the leading insurance brokers in Calgary. As brokers, the professionals at Lane’s work for you, not for the insurance companies. Thus, you can always be sure that they are working to protect your best interests, and are delivering the insurance products you need for the most competitive available rates.
You can trust Lane’s to provide:
- Commercial auto insurance
- General business liability insurance
- Home insurance and auto insurance for individuals — buy a home-auto bundle to save up to 20 percent!
- Specialized types of coverage for individuals or businesses with specific needs
Lane’s Insurance also offers detailed advice, friendly customer service, and outstanding claims support. To learn more, please contact Lane’s Insurance in Calgary, Edmonton, Banff, or other locations throughout the province of Alberta.
