A slip on your store’s floor. A disgruntled client claiming bad advice. Or a product defect that causes injury. Any can trigger a lawsuit — and without insurance, legal fees alone can bankrupt you.
The Key Protection: Liability Insurance
- General Liability: Covers accidents on your premises (like a customer fall) or damage your business causes.
- Professional Liability (E&O): Covers mistakes or bad advice — critical for consultants, designers, and tech firms.
- Product Liability: If something you make or sell harms people.
First Steps if You’re Sued
✅ Call your insurance agent immediately. They’ll alert the carrier, which assigns a lawyer (paid by them).
✅ Avoid direct negotiations or admissions.
✅ Gather records: contracts, communications, video footage.
Bottom Line
Without liability insurance, you’re exposed. A $200,000 lawsuit could wipe out years of savings. Even small home-based businesses often need coverage. In 2025, general liability policies start around $40/month — cheap peace of mind.