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What To Know About Contingent Liability Insurance

As a business owner, you know the importance of striving for maximum profitability and efficiency. Making sure you’re fully insured can be a smart way to ensure you’re protecting your bottom line.

Why Choose Contingent Liability Coverage?

There are several reasons a company would choose contingent liability insurance. A contingent liability, as defined by Insuranceopedia, is caused by a third party, including independent contractors, that the company is doing business with or contractually bonded with in some capacity. 

In other words, even though an organization is not directly at fault, a contingent liability can still create headaches in the form of time and money spent on lawsuit damages. For example, a business may hire an elevator repair person to fix a broken elevator. If a patron of the business happens to incur an elevator-related injury and decides to file a lawsuit, both the business and the elevator repair person may be liable.

Will I Still Need Workers’ Compensation Insurance?

It’s important to remember that contingent liability insurance does not take the place of other mandatory coverage such as Workers’ Compensation. However, it does have the flexibility to fill in the gaps where other plans, such as Workers’ Comp, may fall short.