Yes, commercial general liability insurance also covers property damage. A typical commercial general liability insurance covers loss or damage which may arise due to bodily injury or property damage for which your business may be responsible for paying. Overall, commercial general liability insurance offers coverage in case of bodily injury and property damage for which your business may become liable.
Under the commercial general liability insurance policy, third-party losses or damages are also covered. It comprises repair, renovation, and replacement costs in the case where an accident or loss happens. Further, general liability insurance also makes payment to restore the building if it is damaged or destroyed. Due to an accidental fire that happened on your premises.
Here, it is essential to note, that the commercial general liability insurance policy covers the property damage only if they don’t happen after the expiry of the policy tenure. Also, a claim with regard to property damages should be made with the insurance company during the policy tenure or any extended period as stated in the policy document.
Further, it is necessary for the policyholder to inform the general liability insurance company about any loss or damage that happens to the property damage as soon as the claim is filed against the insured. Also, in any case, the policyholder can’t pay compensation to the third party on its own after the property loss or damage and later approach the insurer for the reimbursement of the same.
Case 1: General Liability Insurance Covers Property Damage
Since 2011, R.S Property has had its office situated in Pune. Though the company takes every precaution to avoid an accident during work, it has also bought commercial general liability insurance to get coverage in case something goes wrong.
Read more: What are the different types of liability insurance?
Last year, the company had to face a major loss when a fire erupted in its office due to short-circuit. Soon the fire spread and engulfed the nearby shop as well. The fire caused severe damage to the nearby shop. The owner of the shop filed a case against R.S Property and asked for compensation for the financial loss. That needed to incur along with the cost incurred in repairing the shop.
As R.S Property had a commercial general liability insurance policy, it approached the insurer for the claim settlement. Here the insurer conducted an investigation and found the shop damaged due to a fire. Occurred at R.S Property’s workplace, and therefore, the shop owner was liable to get the compensation.
The commercial general liability insurance company asked for various documents, like a duly filled insurance claim, a complete account of the business, etc.; and agreed to settle the claim as per the sum insured.
Please note, here the losses happened to the nearby shop, however, the commercial general liability insurance company still agreed to settle the claim. As it covers property damages, this particular claim fell under the purview of the policy, therefore, the insurer settled it.
Case: 2
L.S. Engineering has its office in Mumbai. Last year, it opened a new office in Delhi. When the new office was under construction, one of its pillars fell and damaged the nearby office of the software company. The owner of the software company approached L.S. Engineering for the settlement of losses.
Read more: What is Commercial General Liability Insurance?
As L.S Engineering had commercial general liability insurance, it approached the insurer for the settlement of the claim. The insurer asked for details like a duly-filled claim form, a complete account of the accident, etc. After an investigation, the insurer found that the software company had to incur heavy losses. Due to the fall of the under-constructed pillar. Therefore, L.S. Engineering was liable to pay compensation.
As commercial general liability insurance covers losses or damages caused to property, here, the insurer covered losses or damages. That the software company had to incur due to the accident which took place at the site of L.S Engineering.
The commercial general liability insurance company settled the claim as per the sum insured stated in the policy.
