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Protect yourself from these sources of business liability

by | May 6, 2018 | Uncategorized

Running a business comes with many types of financial risks, but one of the highest is liability. Statistics show that at any given time, nine out of 10 businesses are involved in a lawsuit, reveals Forbes. Litigation is not a matter of if, but when, so you need to protect yourself from common sources of legal trouble.

You can avoid the following liability cases by ensuring you have strong, clear contracts and proper business insurance coverage. An attorney can also help you determine additional risks for your industry.


Unfortunately, some lawsuits come straight from the people you hired. They may accuse you of discrimination, harassment or nonpayment, or you may face problems with them sharing trade secrets or breaking noncompete agreements. You also need to have workers’ compensation insurance in case an employee suffers an injury on the job.


Customers can be both the source of your profits and the source of your losses. Unhappy clients can take you to court for any of these reasons:

  • Breach of contract
  • Premises liability
  • False advertising
  • Product liability
  • Discrimination or harassment
  • Fraud

Safety precautions, proper training and legal assistance are all helpful in preventing most of these claims from happening or getting far. However, not all are avoidable, so make sure your insurance policy covers premises liability, product liability and errors and omissions.


Your property is also at risk. For example, an intoxicated person may destroy your building, or someone may try to rob your establishment or steal digital information. The environment also can cause major damage through flooding or pests. Perhaps you may have your own product liability claim if an item you use in your business has resulted in a fire hazard or other danger. Your insurance should not only cover property damage but also business interruptions, as you will have to pause operations to take care of the matter, so you can recover lost income.

Something else to consider is that insurers may not always be cooperative when you have a claim, so having legal counsel is essential in receiving compensation you deserve.

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