General Liability Insurance in Texas: Costs, Benefits, & Coverage Types
Running a business is already very stressful, demanding, and challenging. If Texas small business owners can have something to help them unburden some of the load, they will likely take their chance. This is when having Texas business insurance comes in handy because having one means protecting your business and your assets.
Let’s say a customer injures themselves on your premises, and they decide to sue you for $100,000. In this case, business insurance in Texas could cover you and pay for legal help and settlements.
So what is general liability insurance in Texas? Texas business liability insurance covers your organization if someone sues you for property damage and personal and advertising injury.
Whether you have a small or big business, be sure to get acquainted first with the laws and government policies about commercial insurance and other insurance policies. It would be best if you did this to ensure that you comply with all the Texas business requirements, and through this, you can be sure that you will not have to deal with penalties later on.
In this article, we will talk about Texas small business insurance, the requirements for general liability insurance, how much Texas small business insurance costs, what it covers, and its exclusions.
We will also cover claims-made vs. occurrence Texas general liability insurance policies and much more!
What is General Liability Insurance in Texas?
Small business insurance may differ for every state, and while some may make it mandatory, others may not, which is why you must know the rules where you have your business. Commercial liability insurance in Texas protects all business or corporation aspects.
Its policy coverage includes the business, the proprietorship, property damage, and its employees. This liability insurance in Texas may also cover the protection of reputation and the finances of a business.
Because there are several kinds of Texas businesses out there, each with its own situations and concerns, business insurance comes in many different forms to respond to the needs of every Texas business.
General liability insurance for small businesses in Texas protects your organization from claims based on property damages, personal injuries, and even advertising injuries by covering defense costs. That said, general liability insurance in Texas can provide the general liability insurance coverage you need to protect your business from potential risks that may damage your company’s success.
Is Commercial General Liability Insurance Required in Texas?
Unlike other US states, small business liability insurance in Texas isn’t required by law. However, businesses with a contract with a government entity must still provide workers’ compensation insurance for each employee until the project is complete. If the small business owner chooses not to have the general liability insurance policy in place, it could eliminate some much-needed protection in case of an expensive lawsuit.
Who Needs Business Insurance in Texas?
Although not required by law, small business insurance in Texas can help you prevent many unforeseen costs. Some of the professions that benefit the most from this type of policy are:
- Food trucks
- Contractors
- Restaurants
- Landscapers
- Manufacturers
- Retail shops
- Barbers
- Accountants
How Much Does Business Insurance in Texas Cost?
A small Texas business, for example, may pay around $300 to $5,000 for a whole year for their general liability insurance. Every liability coverage of a business is unique to each other. It may also depend on the classification system for the GL rating of the insurance company or the SIC code.
The cost of business liability insurance in Texas also depends on the type of policy, so you can expect to pay $42 per month for general liability insurance, $31 per month for workers’ comp insurance, and $59 per month for professional liability insurance.
Premiums for small business insurance policies in Texas, such as commercial insurance, vary because of different factors such as:
- Location
- Number of years in small business payroll
- Exposures
- Number of employees
- Company type
Claims-Made Versus Occurrence Policies
Regarding business liability insurance in Texas, there are two types of policies to explain: claims-made and occurrence.
Claims-made policies cover claims resulting from injuries and damages during the policy period. These claims are also reported to the insurer during the policy period. On the other hand, claims that arise from events outside the policy period are not covered unless you purchase special coverage or arrange it with the insurer.
Occurrence policies cover claims that arise from damages or injuries that occur while the policy is active, regardless of when the claim is made.
Texas Business Policy vs. Personal Insurance in Texas
When getting business insurance in Texas, small business owners must be aware of all the risks that could potentially harm their company so they will also know how to prevent or avoid those risks. No matter what industry your business is in or whether you are a tow truck operator, a dealer of industrial equipment, a light manufacturer, or a shopping or commercial retail center operator, your business certainly needs business insurance in Texas.
Suppose you are purchasing business insurance in Texas. In that case, you should reach out to an insurance underwriter in Texas who is highly experienced and well-trained in business insurance and, if possible, someone who has industry-specific credentials because they are the ones who can lead you to the most appropriate commercial policy for your Texas business.
They can also tell you why it is best to consider getting a business policy rather than personal insurance. They are trained particularly for this kind of insurance policy, so they know the threats and risks of every business in Texas.
The advantage of having a business policy for your Texas business is that it can protect more employees and stakeholders and has a higher coverage limit because more properties are involved. Under this kind of Texas commercial insurance, you may have:
- General liability insurance
- Commercial auto insurance
- Property damage insurance
- Bodily injury insurance
- Workers’ compensation insurance.
While you get personal insurance, such as renters and auto insurance, you don’t get much protection to cover some general liability. Make sure your Texas policy is well-suited for your company’s daily activities. It will save you from various liabilities and unforeseen expenses.
What If My Industry Isn’t Listed In the Most Common Industries Need General Liability?
Most small businesses need TX commercial insurance, so you probably still need liability coverage. You can check if you are eligible for Texas business insurance by contacting your insurance agent.
Types of General Liability Insurance Policies in Texas
If you are not sure what is under this kind of insurance, here are some of the common ones in Texas:
Workers Compensation Insurance
This type of liability insurance is usually mandatory in Texas, especially if your industry is in manufacturing, engineering, construction, or repair. This kind of business insurance protects the Texas firm from any lawsuit that may arise and involves bodily injury while the employee is on duty at work. With this kind of liability insurance, you can save yourself from taking out some personal money to pay for medical expenses.
Cyber Liability Insurance
Because companies in Texas store a huge amount of information on their servers, they need this kind of liability insurance to protect them from cybersecurity damage or a data breach. These kinds of harms can cause some financial dent.
Commercial Auto and Equipment Insurance
It is most helpful for those who deal with automobiles or tools in their day-to-day activities. It would also be great to get extra property insurance to cover devices such as desks, other office pieces of equipment, computers, etc.
These packages may also cover general liability, property, inland marine, and crime. Even if you have a small business, it may be wise to get business interruption insurance as it can protect your company from incurring financial losses if an unexpected circumstance happens. Your business is not capable of operating.
Business Property Insurance
Business property insurance in Texas is needed to pay to repair or replace stolen, lost, or damaged business property and cover your business’s physical location and assets.
Professional Liability Insurance
You need professional liability insurance in Texas (also known as errors and omissions insurance) to protect your business against the defense costs of lawsuits from clients who weren’t satisfied with your work.
Examples of Exclusions of General Liability Insurance in Texas
Although it is quite comprehensive, small business insurance in Texas doesn’t cover everything. There are certain exclusions to commercial insurance in Texas, such as:
- Damage to your work: General liability insurance doesn’t cover property damage to your work.
- Damage to your product: Commercial insurance in Texas doesn’t cover damage to your product or any part of it.
- Contractual Liability: Commercial insurance Texas also doesn’t cover bodily injuries or property damages you are obligated to cover because you assumed liability in the contract.
- Recall of products: Commercial insurance in TX doesn’t cover the costs needed to recall faulty products or impaired property.
Why Choose East Insurance Group?
When it comes to choosing the best general liability insurance in Texas, you need to know that talking to a knowledgeable and trustworthy insurance agency is the best way to find the most suitable business insurance in Texas for your industry and the perfect coverage for your staff. We offer our policies in all cities in Texas, including:
- Houston
- Austin
- Dallas
- San Antonio
- El Paso
- Arlington
Contact East Insurance Group and get your free quote and offer today!
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