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Understanding General Liability
Insurance in Montana

If you own a business in Montana, general liability insurance is something you’ll want to consider. This type of coverage is crucial for protecting your business from various risks, including lawsuits over accidents, injuries, or property damage. Let’s break down how general liability insurance works, why it’s important, and what it can cover for businesses in Montana. 

What is General Liability Insurance? 

General liability insurance (GL) is a type of business insurance that protects your company from claims of bodily injury, property damage, and other risks. Whether you run a small business or a larger company, this insurance acts as a financial safety net, helping cover legal fees and compensation costs if your business is sued. 

Do You Need General Liability Insurance in Montana? 

While general liability insurance isn’t legally required for most businesses in Montana, it’s highly recommended for anyone who interacts with customers or clients. Not only can it help protect against costly lawsuits, but many landlords, clients, and contractors will require proof of GL insurance before signing contracts with your business. 

What Does General Liability Insurance Cover? 

General liability insurance covers a wide range of claims that could potentially arise in the course of doing business. The most common types of claims include: 

  • Bodily Injury: If a customer or visitor is injured on your business property, GL insurance helps cover medical expenses, legal fees, and compensation for pain and suffering. 

  • Property Damage: If your business operations cause damage to someone else’s property (for example, if a contractor accidentally damages a client’s home), general liability insurance can cover the cost of repairs or replacements. 

  • Personal and Advertising Injury: If someone claims that your business has caused reputational harm—through libel, slander, or false advertising—GL insurance can cover legal costs and any settlements or judgments 

How General Liability Premiums are Determined 

The cost of general liability insurance for your Montana business depends on several factors: 

  • Industry: Higher-risk industries like construction or manufacturing tend to have higher premiums compared to lower-risk businesses like consulting or retail. 

  • Business Size: Your company’s size, including its revenue and number of employees, also influences the cost. Larger businesses typically face greater risks and therefore have higher premiums. 

  • Claims History: If your business has a history of frequent claims, expect to pay more for coverage. Insurance companies use your past performance to determine how likely you are to file a future claim 

Optional Coverages to Consider 

While a general liability policy provides broad coverage, there are a few gaps it may not cover. Depending on your business’s specific needs, you might want to explore additional coverages such as: 

  • Professional Liability Insurance: Also known as errors and omissions (E&O) insurance, this protects businesses that provide professional advice or services. It covers claims of negligence or inadequate work. 

  • Commercial Property Insurance: This policy protects your physical assets, including your building, equipment, and inventory, from risks like fire, theft, or vandalism. 

  • Business Owner’s Policy (BOP): A BOP bundles general liability with property insurance, often at a lower rate, making it a popular choice for small to medium-sized businesses 

Common General Liability Insurance Claims in Montana 

Here are a few examples of claims where general liability insurance has proven essential for Montana businesses: 

  • Slip and Fall Accidents: A customer slips on an icy sidewalk outside your business and breaks their arm. General liability insurance would cover the customer’s medical costs, as well as any legal fees if they decide to sue your business. 

  • Property Damage: You own a landscaping company, and one of your employees accidentally knocks over a neighbor’s fence while trimming a tree. GL insurance would cover the cost of repairing the fence. 

  • Advertising Injury: Your business creates an ad that unintentionally damages a competitor’s reputation. If they sue for defamation, your general liability policy would cover legal fees and any settlement costs 

The Consequences of Not Having General Liability Insurance 

Running a business without general liability insurance in Montana can expose you to significant financial risk. Without it, you’d be responsible for paying out-of-pocket for any legal defense, settlements, or judgments if someone sues your business. This can be financially devastating, especially for small businesses. 

Conclusion 

General liability insurance is a crucial investment for Montana businesses, offering protection from a range of risks that could otherwise lead to significant financial losses. While it may not be mandatory, it provides peace of mind knowing your business is covered in the event of an accident, injury, or lawsuit. 

For more information on finding the right general liability policy for your Montana business,  reach out to us at info@mtinsurancebrokers.com or on 406 401 7220. 

-Klinton Jones 
Licensed Insurance Broker