What is Negligence?

If you’re a small business owner, you know that making sure your assets and reputation are intact is crucial. One key aspect of maintaining your business’s standing is by understanding negligence and how it can affect your company and revenue. By defining key components of negligence and why it can happen, business owners can better navigate their operations without financial derailment. Here, we’ll break down the meaning of negligence, its various types, why general liability insurance can help, and how to find negligence insurance for your business.  

What does negligence mean?

Negligence typically refers to a business not taking reasonable action to stop damage or harm to a person or property. In simple terms, it’s about not being careful enough, which can lead to significant problems in the long run.  

For small business owners, negligence can manifest in various ways. If a customer slips and injures themselves in a business or storefront, the owner could be found negligent for failing to maintain a safe environment. Even if you provide a warning sign but you fail to address the situation in a timely fashion, you may still be found negligent. In this instance, the business owner may be held financially liable for the accident.    

Types of negligence

Keeping your business away from negligent claims can be essential for operating successfully. Understanding that there are different types of negligence can help owners avoid customer injuries and unfortunate expenses. The four main categories of negligence are:

1. Comparative negligence: This occurs when more than one party is found to have contributed to an accident. It’s typically common with auto accidents, when multiple people are held responsible for causing damage, though usually to different extents.  
2. Gross negligence: This type is a more serious form of negligence. A gross negligence claim assumes that the perpetrator or business has avoided an average level of reasonable care to prevent another person’s harm.  
3. Contributory negligence: This type arises when a person who’s had an accident didn’t do enough to prevent their own harm. If the injured person is found negligent instead of the accused, they won’t be able to receive payment for damages. Depending on which state you’re in may determine if contributory negligence can be applied.  
4. Vicarious negligence: This happens when employers are held responsible for the negligent actions of their employees while working. For example, if someone injured by your employee claims that the worker had inadequate credentials, your company could also be held liable.

Insurance can play a vital role in managing the risks associated with negligence. Having a general liability insurance policy can cover certain injuries to a third party, but more extreme claims of negligence may not be included. For example, if a customer slips and falls in your store from a wet floor, your general liability insurance could cover potential medical expenses or legal fees.  

Having proper liability insurance is crucial, but it’s also important for business owners to understand that repeated negligence claims can lead to increased premiums. Therefore, maintaining an environment that mitigates harm in the workplace is the best practice for avoiding substantial expenses and customer injuries.

Getting insurance for your business

Navigating the complexities of negligence and its implications for your business can be daunting. However, you don’t have to face it alone. By finding the insurance coverage that fits your needs and budget, as well as understanding your responsibilities as a business owner, you can help your company avoid hazards.

To talk through general liability coverage or what negligence insurance is available for businesses, you can reach out to an experienced agent at Infinity Insurance Agency, Inc. By calling IIA at 1-855-478-3705, you can access helpful information about business insurance or get a free, personalized quote. An agent may also see if you’re eligible for purchasing commercial auto insurance with discounts, like if you already have a general liability policy.  

Understanding negligence can be crucial for small business owners. By knowing what the term means, the types of negligence that exist, and what kinds of insurance can help navigate negligence claims, you can better eliminate potential risks in the future.