The liability insurance of a commercial business borrower should be reviewed to determine if the following coverage is in effect:
•Automobile liability insurance for bodily injury or property damage arising out of the use of automobiles. Even if the borrower has no owned or long-term leased automobiles, the business needs hired and non-owned automobile liability insurance to over itself against claims arising out of the use of automobiles by employees and others working on behalf of the borrower.
•General liability insurance covering liability for bodily injury to others, property damage to non-owned property, loss of use of that property, and listed personal injuries such as libel, slander, defamation, and invasion of privacy.
•Umbrella or excess liability policy or coverage providing increased coverage beyond the limits of the aforementioned policies.
•Professional liability insurance covering financial losses to third parties arising out of errors or omissions made by the governing body and management in day-to-day operations. This policy or coverage specifically excludes bodily injury, property damage, or personal injury covered by the general liability policy. Professional liability insurance may be purchased as a stand-along policy or as part of a management liability policy.
•Workers’ compensation insurance to cover claims for work-related injuries made by regular employees, temporary employees, or employees of uninsured contractors used by the borrower.
•Directors’ and officer’s liability insurance covering directors’ responsibilities for financial loss to stakeholders arising out of mismanagement of the business entity itself. This is usually the core coverage provided by management liability policies.
•Employment-related practices liability insurance for mental or financial injury to employees typically including, but not limited to, discrimination, wrongful termination, and sexual harassment.
•Cyber liability and crime policy to cover risks arising from a data breach or other cyber attack on a business’ computer systems.
•Business Interruption insurance covering loss of revenue.