Understanding General Liability Insurance Requirements in Washington State
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If you're running a Washington business, it's helpful to know how general liability insurance in Washington State works. Washington general liability insurance isn't mandatory state-wide, but it is a requirement for certain industries. Whether you're just starting to think about a business venture and have questions about business insurance coverage or you're an established business owner assessing your liability coverage, we'll help you stay compliant and protected.
Introduction to General Liability Insurance
General liability insurance (GLI) protects businesses from financial loss due to bodily injury, property damage, or other incidents. Unlike Washington auto insurance, it is not mandatory. Nonetheless, GLI is an important safeguard for businesses to stay protected from lawsuits resulting from workplace accidents or cutthroat competition.
What Does General Liability Insurance Cover?
Depending on the insurance policy, GLI typically covers:
- Bodily injury: Injuries that occur on business premises
- Property damage: Damage caused by business operations
- Libel and slander: Allegations that the business defamed individuals or companies
- Advertising injury: Claims of copyright infringement
- Reputational harm: Claims of libel or slander resulting from statements made by the business or its employees
With this kind of business insurance policy, you can cover property damage and medical bill costs, or pay a legal cost associated with going to court over any of these incidents.
State-Specific Requirements for Washington State
While general liability insurance in Washington isn't always mandatory, it is required for many high-risk industries. Instances in which the state does require GLI include:
- Commercial leases: In most cases, commercial leases of equipment or machinery require GLI.
- General or specialty contractors: Construction companies and general contractors must register with the state and provide a certificate of insurance.
- Vapor product licenses: Washington legal code WAC 314-35-021 requires any company selling vapor products to have GLI.
Even if your company doesn't fall within these few state requirements, general liability insurance in Washington State is still a good idea for most businesses to have. Some professional licenses, like in real estate or private medicine, require GLI. Likewise, many businesses that rent office space may need to obtain GLI as a condition of their lease.
Review the insurance requirements of your state:
Determining the Right Coverage for Your Business
Figuring out the right Washington general liability business insurance coverage isn't quite as straightforward as finding car insurance in Washington State. Some industries are simply riskier than others.
To determine the coverages you need, ask the following questions:
- Does my business's operations risk bodily injury or property damage?
- Could the products my business sells elevate the risk of lawsuits from consumers?
- Does my business have a lot of public interaction that could lead to claims of libel, slander, or misrepresentation?
- Does my business handle sensitive customer data?
- Do my clients or partners require my business to have certain coverages?
If you answered yes to any of these questions, commercial general liability insurance in Washington State is a good idea. The right policy limit depends on your business's risk tolerance.
If you work with clients in a professional role, such as an architect, consultant, or accountant, consider professional liability insurance to protect against claims of negligence that result in financial losses for clients. Additionally, if your business has employees, Washington requires you to have workers' compensation insurance.
Costs of General Liability Insurance in Washington State
The cost of GLI in Washington State ranges based on several factors. The most important ones an insurance company gauges when assessing insurance premiums include:
Business type: High-risk businesses pay higher premiums.
Location: Higher crime areas tend to have higher premiums.
Claims history: Businesses with extensive claims history pay more.
Coverage: More coverage equals higher costs.
Policy limits and deductibles: Setting limits and paying higher deductibles may lower your premiums.
Number of employees: Businesses with more employees usually pay more for GLI.
The average cost of general liability insurance in Washington is $42 per month.
How General Liability Insurance Supports Business Compliance
Washington State regulations require businesses in some high-risk industries to carry general liability insurance. Likewise, private companies like property management organizations or professional certification bodies may require your business to carry general liability insurance. Having a policy can help you avoid compliance issues with the government and with other companies.
Benefits of General Liability Insurance for Peace of Mind
While some businesses need general liability insurance for regulatory compliance, it's a good idea for all businesses to at least consider GLI for peace of mind. Nobody can see the future. Accidents happen in the course of business operations, and businesses can't control what their employees say to customers and in the public arena.
General liability insurance casts a wide net, protecting businesses from everything from a company truck accidentally hitting a fire hydrant to a spokesperson mistaking the specs of a product. This coverage provides wide-reaching peace of mind.
Compare Insurance Options and Get the Best Coverage
Finding the right general liability insurance in Washington State for your business doesn't have to be hard. There are many resources available to help you find the best policy. Likewise, if you're shopping for cheap car insurance in Washington State for a fleet of vehicles, use EverQuote to compare quotes and find the best policy for your budget.