What is Florida General Liability Insurance?

Florida general liability insurance is designed to protect contractors from claims resulting from the contractor’s construction operations that result in damage to a third party. Under a Florida general liability insurance policy, the insurer is obligated to pay the legal costs of a business in a covered claim or lawsuit.  Covered claims can include bodily injury, property damage, personal injury, and advertising injury (damage from slander or false advertising). The insurance company also covers compensatory and general damages. Punitive damages aren't covered under Florida general liability insurance guidelines because they're considered to be punishment for intentional acts.

In today's litigious society, even small mishaps can result in large lawsuits. That's why Florida general liability insurance,  along with property and workers compensation insurance, are essential for most companies. Liability insurance protects the assets of a business when it is sued for something it did (or didn't do) to cause an injury or property damage.

Important Florida Contractors Liability Insurance Limits and Exclusions

Florida general liability insurance policies always state a maximum amount that the insurer will pay during the policy period as well as the maximum amount the insurer will pay per occurrence. For example, if a company has a $1 million occurrence cap in its Florida general liability insurance policy and it's successfully sued for $1.5 million, the insurer would pay $1 million and the business would be responsible for paying $500,000.

There is a common exclusion in many Florida commercial liability insurance polices that affects Florida contractors liability insurance in particular.  It is called the "faulty workmanship exclusion".  The faulty workmanship exclusion excludes coverage for property damage to “that particular part of any property that must be restored, repaired or replaced because your work was incorrectly performed on it. . . .  It excludes costs to repair or replace defective work discovered while the insured is still performing its work. The faulty workmanship exclusion does not apply to damage covered by the products-completed operations hazard.  In other words, claims may still be covered for property damage arising out of your product or your work after the work is no longer in your physical possession.  All of this means that in some instances your Florida general liability insurance policy may not be responsible for claims made against you as a result of faulty or defective workmanship.

How Are the Rates Determined for Florida Construction Liability Insurance?

The rates for Florida construction liability insurance rates are typically based on a percentage of gross payroll or on a percentage of gross revenue.  The exact percentage charged varies depending on the type of work being performed.  Most Florida contractors liability insurance is billed based on an estimate of what you believe your payroll or sales will be for the upcoming policy period.  You pay a monthly bill based on that estimate.  At the end of the policy period your Florida construction liability insurance company will audit your payroll or sales records to determine the exact premium owed.  If you have met the minimum earned premium amount set forth in your policy, you will recieve a refund from your Florida liability insurance provider if the amount you owe after auit is less than the amount that you paid durng the policy period.