The post What Is Third Party Insurance? | Embroker article about travel insurance this times many people want to know !! Today, Begin https://insuranceblog.us/ find What Is Third Party Insurance? | Embroker more this post ! You are watching chủ đề về : “What Is Third Party Insurance? Đánh giá về What Is Third Party Insurance? | Embroker

Any time you purchase a business insurance policy, you’re forming a legal relationship in which you are the first party and your insurer is the second party. If that’s the case, then what is third party insurance?

Third-party liability is one of the most basic types of coverage and it is very often included in some of the most common and popular policies that businesses purchase.

When purchasing a typical business owners policy (BOP), it’s very common to see third-party liability included in this bundle (which is made up usually of general liability, commercial property, and business interruption insurance).

Third-party liability is often included in commercial auto insurance policies as well.

Who Exactly Is the Third Party?

The third party is a party that is unrelated to your businesses but does come in contact with it in some way. It could be a client, customer, partner, supplier, distributor, or any other entity that interacts with your business but is not in any other way associated with it.

If your business damages the property of a third party or a third party is involved in a slip and fall accident at your workplace and files a claim against your company, third party insurance would protect you, covering legal costs and other possible damages.

Does Your Business Need Third Party Liability Insurance?

The short answer is “yes.”

Having third party insurance for your business is one of the basic and most vital foundations of any risk management program.

If your business has direct contact with customers and clients on an everyday basis, is involved in shipping and distributing goods, or provides services that can impact others, you’re going to need some type of third party insurance.

The most important aspect of procuring this insurance is making sure that you are speaking to an expert broker who will be able to access your risks and advise you on which of your insurance policies should include a third party liability endorsement.

What It Covers

What your third party insurance covers will depend on whether the third party insurance endorsement is being added to your BOP, general liability, commercial property, or commercial auto insurance policy.

In the most general terms, third party insurance will cover bodily injury or property damage for which the third party claims your business was directly responsible. For example:

• A patron comes down with food poisoning after eating at your restaurant and decides to sue your business.
• A mechanic working for your auto repair company damages a car that your customer brought in for repair.

These are a few standard examples of what typical third party claims look like. In such cases, your third party insurance would cover legal costs, medical bills for bodily injuries, and repair costs for property damage.

What It Doesn’t Cover

There are some business issues for which third parties can file claims against your company that will not be covered by typical third party insurance.

The most common example is an instance that an errors & omissions insurance policy would cover. If your company’s negligence, malpractice, errors, or poor advice have led to a customer or client losing money, they could file a claim against you. An E&O or professional liability policy would provide coverage for these types of claims.

People who provide professional services such as doctors, accountants, and lawyers often purchase specialized malpractice insurance policies that are specifically written to address the risks that are most present in those specific professions. For example, law firms would purchase a legal professional liability product and healthcare providers would purchase medical malpractice insurance.

If your business has been hacked or was the victim of any other type of cybercrime that causes damages to your customers or partners, you would need a cyber liability policy to provide coverage in these types of situations.

How Much Does third party insurance Cost?

Just like with any other insurance policy, there are a large number of factors that influence the price of your third party liability coverage. But considering that it’s a pretty basic type of coverage, it usually isn’t very expensive.

The premium you pay for third party insurance will depend on your industry, the specific risks associated with your industry and business, the size of your company, the number of employees you have, the number of locations you run, your history of third party liability claims, among other things.

If you’re interested in learning more about this insurance type and purchasing third party liability insurance to protect your business properly from these types of risks, feel free to reach out to one of our expert brokers at any time.

To learn more about the. right coverage for your business, check out Embroker’s digital insurance platform.