What type of insurance covers legal liability for injuries or damages to third parties?

General liability insurance is designed to cover legal liability for injuries or damages to third parties. This type of insurance provides protection against claims resulting from accidents, injuries, or damage to property that occur during the course of business operations. It is essential for businesses because it helps cover the costs associated with legal defense, settlements, and judgments that may arise from such claims, ensuring that the company is financially secure in the event of an unforeseen incident.

This type of coverage is vital for a variety of industries, including construction, retail, and services, as it addresses risks that are inherent in interactions with clients, customers, and the general public. In contrast, other types of insurance, such as errors and omissions, workers compensation, and builders risk, serve different purposes: errors and omissions provide coverage for professional services, workers compensation covers employee injuries on the job, and builders risk is specific to property under construction. Each of these covers distinct liabilities and risks not related directly to third-party injuries or property damage.