Finding the Right General Liability Insurance in North Carolina

Operating a business comes with risk. Lawsuits, property damage, and accidents can all negatively impact your company’s finances if you’re not properly insured.

That’s why having adequate general liability insurance in North Carolina is crucial. But with so many options, how do you pick the right policy?

In this comprehensive guide, I’ll explain everything you need to know about purchasing general liability insurance in NC.

What is General Liability Insurance?

General liability insurance protects your business from financial loss due to:

• Bodily injury
• Property damage
• Personal injury
• Advertising injury

It covers both legal costs and any settlement amounts or judgments against your company up to the policy limits

General liability is a broad form of coverage that encompasses many risks a business may face. It’s one of the most important policies for companies of any size.

Why is General Liability Insurance Important in NC?

There are a few reasons obtaining adequate general liability insurance is critical for North Carolina businesses:

It’s legally required – Many business licenses and permits mandate you carry liability coverage. Establishments open to the public especially need it.

It protects your assets – One lawsuit could bankrupt your business if you lack coverage Liability insurance shields your company’s finances

It covers attorney fees – Mounting legal bills alone can sink a business, Liability policies pay legal costs whether you win or lose the case

It makes clients feel safe – Customers want reassurance they won’t get injured on your property. Having coverage demonstrates you take safety and responsibility seriously.

It’s affordable – Premiums cost 1-3% of revenue on average. Compared to the risk protection it provides, general liability insurance is very fairly priced.

In short, liability coverage is mandatory, protects your livelihood, and shows customers you value their safety.

North Carolina General Liability Insurance Requirements

The State of North Carolina mandates all businesses carry general liability coverage if members of the public will be on your premises.

Some of the main liability insurance requirements in NC include:

• Bars/restaurants – $1 million per occurrence
• Hotels/motels – $50,000 per occurrence
• Child care centers – $100,000 per occurrence
• Home repair contractors – $100,000 per occurrence
• Tradesmen (electricians, plumbers, etc) – $100,000 per occurrence

These coverage minimums are codified in North Carolina general statute Chapter 58. Optional higher limits are recommended for added protection.

If your business serves alcohol, you also need separate liquor liability coverage. Other industries like construction and manufacturing have their own rules for liability insurance requirements too.

What Does General Liability Insurance Cover?

A general liability policy has three main coverage areas:

Bodily Injury and Property Damage

This covers injuries to third parties that occur on your business property. For example, a customer slipping and falling in your store.

It also covers damage your business accidentally causes to someone else’s property. For instance, if your delivery truck hits another vehicle, their repair costs would be covered.

Personal Injury and Advertising Injury

Personal injury protects against libel, slander, false arrest, invasion of privacy, and copyright infringement.

Advertising injury covers damages caused by your marketing, like copyright violation or unauthorized use of a slogan.

Medical Expenses

If a third party gets injured on your property or by your operations, their medical bills will be paid up to the policy limit.

This includes ambulance fees, hospital stays, rehabilitation, and other medical costs.

What is NOT Covered by General Liability Insurance?

While very broad, general liability policies do not cover every risk. Common exclusions include:

• Intentional harm caused by the policyholder
• Damage to owned property
• Damages occurring outside the policy period
• Losses stemming from illegal activity
• Injuries to employees (covered by workers’ compensation)
• Malpractice or professional services
• Pollution incidents
• Product defects or recalls

It’s critical to understand these coverage gaps when buying liability insurance in North Carolina. You may need separate policies to address some excluded risks.

How Much General Liability Coverage Does My NC Business Need?

The amount of general liability insurance you should buy depends on your business type, size, and risk profile. But a few general guidelines can help determine appropriate limits:

• Buy enough to meet your state insurance requirements

• Carry at least $1 million per occurrence / $2 million aggregate if you interact with the public

• Increase limits if you have high traffic, operate in a hazardous industry, or have substantial assets at stake

• Consider your own tolerance for financial risk and legal expenses

• Align with coverage amounts competitors and partners maintain

Work with an agent or broker to analyze your needs. They can recommend adequate liability limits so gaps in protection are avoided.

How Much Does General Liability Insurance Cost in North Carolina?

General liability insurance rates vary greatly by risk class and coverage amount. On average, North Carolina businesses pay:

Low-risk: $600 per year (e.g. consultant, accountant)

Medium-risk: $1,200 per year (e.g. restaurant, retail store)

High-risk: $5,000+ per year (e.g. construction company)

Exact costs depend on factors like:

• Industry
• Location
• Years in business
• Past claims
• Coverage amount
• Deductible

Get quotes from multiple insurers to find the best rate for your business based on these parameters.

5 Tips for Buying General Liability Insurance in NC

Follow these tips when purchasing general liability coverage:

1. Work with an agent – They can explain available options and recommend adequate limits based on your risks.

2. Compare multiple quotes – Rates can vary significantly between insurers. Shop around for the best deal.

3. Examine exclusions carefully – Ensure no significant coverage gaps exist that would leave you exposed.

4. Discuss limits with your attorney – An attorney’s expertise helps determine appropriate coverage amounts to protect your assets.

5. Review annually – Communicate any business changes to your insurer so coverage remains up-to-date over time.

Where to Buy General Liability Insurance in North Carolina

There are a few options for purchasing liability policies in NC:

• Insurance brokers – Brokers have access to quotes from multiple carriers and can compare rates for you.

• Direct insurers – Buying directly from national carriers (Geico, Progressive, etc) can offer convenience. But policy options are limited.

• Professional associations – Organizations like NFIB offer liability insurance as a member benefit.

An independent insurance broker has the incentive to find you the right policy with the best rate and terms. I recommend starting there.

Protect Your NC Business With Liability Coverage

As a business owner, you have so much on the line personally and financially. Don’t let a lawsuit or accident put your livelihood in jeopardy.

Securing adequate general liability insurance tailored to your North Carolina company provides peace of mind and financial security. Trust me – it’s worth the investment.