Violations vs. Willful Action
Errors in the course of business dealings may be covered, but willful lawbreaking often isn’t.
A commercial general liability insurance policy is an essential, broad-form coverage that protects businesses from injuries to others and damage to their property caused by your company or employees. Without this insurance, your business could be bankrupted by a single, simple accident. But don’t let this solid coverage lull you into complacency. It does not cover willful violations of the law.
Business liability insurance and professional liability, or errors and omissions (E&O) insurance, are meant to protect companies and professional firms and their employees from hefty costs associated with mistakes or negligence — not crimes. What if your employee does something intentionally wrongful, malicious or illegal? For example, an employee could assault a customer not in self-defense or delete a customer’s computer files to teach them a lesson. In those cases, neither your commercial general liability insurance nor your professional liability insurance will provide coverage since those are intentional acts of wrongdoing that carry an expectation of harm to the victim.
If you are concerned that the stress level of an employee might cause him to react badly in some circumstances, the best action is to remove him from the situation. If you have someone who is in a conflict that has momentarily escalated, immediate action is needed. For employees who are increasingly under stress — financially, emotionally, physically — your company should consider an employee assistance program or some other outreach to help the employee adjust his responses and address his problems so the chronic stress doesn’t explode on the scene or fester behind the scenes.
Your Trusted Choice® Independent Insurance Agent has multiple plans that provide not only solid insurance coverage for your business liabilities but also risk management programs that can help prevent claims and bad occurrences in the first place. Your agent can also help you understand the interplay between workers compensation insurance, liability coverages and prevention programs, the last of which may fall under employee benefits.
Some intentional acts of wrongdoing can be insured against, but they usually require special additions to a standard liability policy. For example, if you are worried about molestation, workplace harassment, or theft by your employees, there are insurance products — stand-alone policies or endorsements — that can be added to your portfolio. Talk to your Trusted Choice® Agent about a comprehensive business liability protection plan.