What Does General Liability Insurance Cover A Small Business In New Mexico?

If you own a small business in New Mexico, you should consider getting general liability insurance. This policy protects your business against claims of property damage and bodily injury. 

If an unforeseen event occurs and you don’t have general liability insurance, a single large claim could cost you your entire business. Therefore, general liability insurance for small businesses gives you the protection you need to continue building your company.

General liability insurance takes into account lawsuits resulting from daily business operations. Here are some details of the policy coverage:

Property Damage

General liability insurance for small businesses can compensate the costs of repairing or replacing customer property that has been unintentionally damaged by your business. For instance, if your employees accidentally damages property at a client’s house, this insurance policy can pay for repair and replacement.

Bodily Injury

A customer may get hurt in an accident on your business premises. In this case, a general liability policy can cover the medical expenses. 

If a customer gets hurt after slipping or falling on your premises, they may also file a lawsuit against your business. A general liability policy will take care of the legal expenses in this case.

Product Liability

Property damage does not only happen within business premises. A customer may sue your business if you produce, distribute or sell goods that end up harming any customer. In such a scenario, general liability insurance can pay for the legal expenses.

Advertising Injuries

Copyright infringement, slander, and libel are crimes that can result in a lawsuit. For example, if an employee of your business leaves a poor review about a competing business, the owner of that business may file a lawsuit against your company. 

General liability insurance for small businesses can cover the legal expenses, along with judgment or settlement costs in case your businesses faces a lawsuit over advertising mistakes.

While general liability insurance for small businesses is comprehensive, there are some exclusions you need to know about. Here is what general liability insurance does not cover:

Professional Errors

Professional errors are generally covered by errors and omissions insurance. This policy takes into account lawsuits over professional mistakes, such as missed deadlines and undelivered services. 

Employee Injuries

General liability insurance for small businesses does not cover medical expenses or lost wages in case of injuries to employees. For this purpose, there is a separate policy known as workers’ compensation insurance.

Damage To Property

General liability insurance does not provide coverage in case your business property gets damaged or stolen. For repairing or replacing business property, a business owner’s policy is more suitable.

Vehicles

Vehicles owned by a business are not covered by general liability insurance policy. They are usually taken into account by commercial auto insurance. 

However, for personal vehicles used for work, rented vehicles, and leased vehicles, you can choose to get hired and non-hired auto insurance attached to your general liability policy. 



Liquor Liability

People who become intoxicated may cause untoward incidents at your business, such as assault, vandalism, and drunk driving. Liquor liability insurance can cover the legal expenses in case of a lawsuit over such an incident. You can either purchase this as a separate policy or get it added to your general liability insurance policy.

General liability insurance for small businesses is important in order protect your business against major financial setbacks. Here are some of the top benefits of this insurance policy:

Security Against Unforeseen Events

One of the most significant benefits of a general liability insurance policy is that it provides a financial cover in case of unforeseen events. 

Even if you do your best to ensure smooth business operations, there is always a chance of an accident taking place. By opting for general liability coverage, you can be at peace knowing that you would be protected in case of an unfortunate event.

Security More Contract

Having a general liability insurance policy in place can help your small business grow by closing more contracts. Several firms require a business to have general liability coverage before finalizing a deal. With this insurance policy, you would be all set to close more contracts.

Trust Building

Having a general liability insurance policy shows that your business is there in the industry for the long-term. An insurance policy boosts trust and enhances the reputation of your business. If a customer likes your products and services, they may recommend your business more often.

Protection Against Injury Claims

If you often meet clients face-to-face, a general liability insurance policy is crucial. Whether you see customers at your business premises or at their home, there is always chance of an injury claim. With a general liability policy, you no longer have to fear the heavy costs associated with lawsuits as a result of bodily injury to clients.

Protection Against Staff Actions

Even if you ensure you hire the best employees, sometimes staff actions can endanger your business. In case of libel or slander committed by a staff member, a third party can file a lawsuit against your business. In certain cases, general liability insurance can cover the legal expenses resulting from such a lawsuit.

Without general liability insurance policy, your business may face settlements, judgments, and legal fees. This can be expensive and even lead to bankruptcy. The cost of legal counsel can be more than a whopping $100 per hour.



Not having a general liability insurance policy can expose your business to grave financial risk for several kinds of liability claims. Moreover, you may end up losing clients if they refuse to do business with you due to lack of general liability insurance. 

General liability insurance for small businesses is essential for protection against claims of bodily injury and property damage. Carrying this insurance will help build clients’ trust and boost your business’s reputation. In case of a major expense, your business would be saved from bankruptcy as your insurance policy would have you covered. For more information about getting the right auto body insurance speak with a New Mexico Commercial Insurance specialist today!