Professional performance as a company or freelancer exposes you to different risks, which leads to protecting yourself and ensuring civil liability. Really, do you know what Civil Liability Insurance covers for the self-employed person or company?
Civil liability insurance is the policy that covers claims for personal and material damage caused to a third party. In the event of accidentally causing damage to a third party, there is a civil responsibility to fix the damage and/or financially compensate for it. Civil liability insurance covers these compensations in favor of the policyholder.
Civil liability insurance for companies and the self-employed are not all the same, they depend on the activity you carry out, the risk of your activity, the billing and contracted coverage . If you do not have the correct coverage or insurance capital, underinsurance may occur in the event of a claim, so the policyholder could respond with his own assets to the third party’s claim.
So that this does not happen, it is always good to have a specialized insurance brokerage .
What are the civil liability insurance coverages for companies and the self-employed?
The coverage of a civil liability policy depends on the activity of the company or self-employed person. For example, a street trade does not need the same coverage as a manufacturing factory .
The damages covered by the civil liability policy are:
- Personal damage . Example, a client falls in an office because the floor is wet.
- Material damage . Example: a water leak in a store and generates humidity to the neighbor.
- Economic damages . Example: due to a fire in a store, the adjoining business is affected and cannot open, causing financial damage.
To cover the different activities of the companies, the most outstanding coverages would be:
General Civil Liability or RC Exploitation
The rc exploitation coverage in the civil liability insurance covers claims for damages to third parties during the development of the professional activity.
- Example of General RC coverage: A customer enters our store and falls on the wet floor. If you suffer any damage as a result of that fall, the compensation will be covered by the general civil liability insurance contracted.
Essential coverage in civil liability insurance for companies . Especially when they are companies with a large number of workers. The employer’s civil liability covers the claims of employees after suffering an accident at work or of their relatives after the death of the employee. As long as there is negligence on the part of the employer.
With the Employer’s RC, the responsibility that the company may have for the damages suffered by its personnel is covered. For example, a work accident involving compensation. Since these compensations can be very high amounts, the employer’s rc is an essential coverage in civil liability insurance for any company.
- Example of Employer’s RC coverage: An employee of our company falls from a scaffolding at a construction site for not having the regulatory safety measures.
Companies must have covered any claim for damage or harm that comes from their products.
- Example of Product Liability: The intoxication of a child by a toxic component of a toy.
Subsidiary RC to respond to damages caused by companies subcontracted to third parties
Entrepreneurs must respond to the actions or omissions of third parties. In the construction sector, the contractor will have to respond to the damages caused by companies subcontracted to third parties. In this case, subsidiary civil liability will be activated .
- Example RC Subsidiary: If we hire a rope access company and while they are fixing a facade a tool falls and damages a third party car, civil liability falls on the contractor.
Cross Civil Liability is applied in the context of contracting and subcontracting . Cross coverage falls on the main employer when the workers of a subcontracted company suffer personal injury. This type of guarantee is optional and is usually reflected as additional coverage in civil liability insurance for works, reforms, handling of machinery, etc.
Therefore, the RC Cruzada coverage covers personal damages that the employees of a subcontracted company may suffer , since the civil responsibility of indemnifying the worker falls on the main employer
- Example of Crossed RC: If the employee of a subcontracted company suffers personal injury while carrying out his work. The compensation in this case will be covered by the cross coverage of the RC policy.
Post-Work Civil Liability guarantees compensation for damages once the work has been completed or the product has been supplied. Normally this post-work guarantee is valid for a limited time once the product has been delivered: 12 months, 24 months or 36 months as the most common periods.
- Example of Post-Work Civil Liability: A pipe that breaks six months after the work was delivered and floods a shopping center affecting several stores.
The locative civil liability is aimed at professionals who carry out their activity in a rented premises or if they rent one to hold an event . The locative rc corresponds to the responsibility that falls on the lessee with respect to the lessor. Therefore, the lease covers damages produced in a premises belonging to another person.
- Example of RC Locative: We have a place that we rent to a music group to do a concert and the attendees cause structural damage to the place, for example: a wall was broken. The rental coverage of civil liability will be responsible for covering said damage.
Real Estate RC
Real estate civil liability protects property owners against third-party claims for damages caused by those properties.
- Real Estate RC Example: The cornice of a local detaches and falls on a vehicle, causing serious damage.
RC Accidental Contamination for companies
Accidental Contamination CR
Some companies during the development of their activity may cause accidental contamination to third parties. The compensation for these damages will be covered with accidental contamination rc.
- Example of Civil Liability for Accidental Contamination: A truck that transports toxic material has an accident, overturns and spills the contents on a private farm, affecting its land where there are crops and plantations. The damages caused to this third party will be covered by this coverage.
Is Civil Liability Insurance mandatory?
As a general rule, no . But depending on the risk and material or personal damage, there are some activities where the legislation does require, at the state level, to contract mandatory civil liability insurance .
As you can see , civil liability insurance includes numerous coverages for situations where your company or your assets may be harmed . For our own reasons or those of others, we may be subsidiaries of responsibilities for damages to third parties, whether physical, material or of other kinds.
In addition to these, there are other types of more specific Civil Liability Insurance such as:
- Promoter Civil Liability.
- Civil Liability for Builders.
- RC for Cooperative Managers.
- Civil Liability for Forwarding Agents.
- Civil Liability Insurance for Temporary Work Companies.
- Civil Liability for Security and Surveillance Companies.
- Environmental Responsibility.
- Civil Liability Insurance for Drones.