Self Employed Liability Insurance - The Basics
Liability insurance is critical for individuals who are self employed. Liabilities are essentially anything that individuals may be held accountable for in court. For example, if you own a facility and someone slips and injures his or herself, you could be held liable in court. Lawsuits are becoming more and more commonplace, and with this trend, self employed liability insurance is also becoming more common. The two main roles that liability insurance has is to defend, and to indemnify.
When one with liability insurance is sued, the duty to defend comes into play. Individuals can contact their insurance provider and sending them a copy of complaint, along with an explanation and reference to what parts of the policy pertain to his or her specific case. Conversely, indemnification involves the insurance company paying the amount to which the defendant is held responsible. The insurance company will pay in accordance with the stipulations set in the insurance plan. Self employed liability insurance is practical, because if a self employed person is sued and found guilty who does not have coverage, the sum will undoubtedly be quite hefty.
There are, however, certain instances in which liability insurance will not cover certain fees. For example, most liability insurance only covers the risk of being sued for strict liability, or negligence. Any tort that has a higher level of mens rea is usually not covered. Mens rea (or, "guilty mind") refers to the extent of intentionality with which an individual commits a crime. So, if someone is knowingly endangering someone, there would be a different degree of mens rea than if someone did not do anything that could knowingly endanger someone. Self employed liability insurance does a lot, but it does not strive to protect knowing criminals.
If you are interested in purchasing self employed liability insurance, there is a lot of information available online. In the United States, it is not mandatory to have this type of insurance (it is only mandatory to have auto insurance if one has a vehicle). Still, liability insurance is very important for any business owner. Unforeseen circumstances may warrant one to fall back on their liability insurance, and there are horror stories of instances in which individuals were not properly insured and were found liable. Do your research online to find the best liability insurance for your business, and remember, it is always better to be safe than to risk everything.
by: Sal Trump