Frequently Asked Questions

What is General Liability Insurance?

General liability Insurance provides protection against two types of financial loss arising out of a lawsuit against the company. First, it covers damages awarded to a third party because of injury or damage for which the insured is legally responsible, including loss of use of property claims. In addition, it covers the cost of defending the insured against the charges alleged in the suit, including attorney fees, investigation costs, and other legal expenses.

General Liability Insurance does not cover workplace injuries that happen to employees or other people on your payroll. Such incidents are typically covered by Workers Compensation. Likewise, General Liability Insurance does not cover the costs of damage to your own business property. Typically, it only helps cover the costs of damage your business causes to others. Commercial Property Insurance is designed to help cover the costs of damage done to your business’s property.

Do you know what your General Liability Policy Limit is and what happens if you are underinsured?

 Your specific policy will have a maximum amount that is paid out for a claim. Any liability that you are responsible for over and above your maximum is your responsibility. For example:

• You are sued for $350,000 in medical costs associated with an injury.
• You are responsible for an additional $100,000 in legal fees.
• Your policy has a maximum claim liability amount of $400,000.
• You are responsible for the additional $50,000 not covered by your policy.

When you are selecting your policy, keep in mind that your policy will have a maximum amount the insurance company will pay, so select your policy carefully.

Are you aware that you can Increase your coverage?

Just because your General Liability Insurance Policy has a limit, doesn’t mean your business has to be vulnerable. All you need to do is add some umbrella insurance. An umbrella insurance policy provides additional coverage above and beyond what your General Liability and other insurance will cover.

Say one of your employees has an accident in the company truck and the result is that you owe $1m in legal fees and medical bills for the other party, but your commercial auto policy has a $500k limit. This is when your umbrella policy would kick in to cover the other $500k so you aren’t left owing that money out of your own pocket. Being prepared with an umbrella policy is an easy way to protect your business from going bankrupt if an accident ends up costing more than your primary contractor insurance will cover.

Are you aware that your Personal Auto Policy does not cover your business vehicle?

Personal automobile policies exclude vehicles that are used for commercial and business purposes. If you get into an accident without commercial auto insurance you run the risk of getting sued by anyone involved in the accident and facing expensive medical and legal cost as a result. Commercial automobile insurance, also called fleet insurance, protects you and pays for repairs, medical costs, and legal fees if you get in an accident.

Did you know that your Commercial Auto Insurance does not protect your tools & equipment?

You might be surprised to know that your tools and equipment are not covered by your commercial auto policy. For that you need Inland Marine Insurance. Any time you transport your tools to a job site, they are vulnerable to any number of catastrophes. How are you supposed to work if your tools are destroyed or stolen?

If you have an inland marine policy, your business is protected if your tools are stolen, vandalized, or otherwise destroyed on the way to or from a job. If an accident happens when you’re on the way to work, your tools and equipment are only covered by insurance if you have an inland marine policy.

What is a Hold Harmless Agreement?

In a hold harmless agreement, one party (the indemnitor) promises to reimburse, and in some cases defend, the other party (the indemnitee) against claims or suits brought against the indemnitee by a third party. The purpose of the hold harmless is to transfer the risk of financial loss from one party (the indemnitee) to another party (the indemnitor).

Are employees covered under Personal Injury in a General Liability Policy?

Employees have no coverage with respect to injuries sustained by the named insured, its partners or members, or to another employee or volunteer.

What is Workers Compensation?

Workers Compensation insurance provides certain payments to an employee who suffers an on the job injury due to an accident or occupational disease.

What is a Certificate of Insurance?

A certificate of insurance (COI), is a one-page document that provides policy details on your liability insurance coverage, verifying that you have the business insurance you claim to have. It summarizes essential information like the types and limits of coverage, the issuing insurance company, your policy number, insurance limits, the named insured, and the policy’s effective and expiration dates.

Why do I need a Certificate of Insurance?

Sometimes referred to as a certificate of liability insurance or accord certificate of liability insurance, it is often required in order to win contracts. This way, your potential client can know for sure whether you have business insurance. Many companies and individuals that hire contractors need to know that they won’t be held liable for damages, injuries, or substandard work, and therefore require that you have insurance.

What is an additional insured?

Construction contracts frequently require contractors to add other parties to their liability policies as additional insureds. It is a second layer of protection for the contractual indemnity agreement. Additional insured can submit claims directly to the insurer without first filing a claim against the named insured.

What do I do if I have a claim?

 If a claim occurs, immediately contact your agent at Alliance West Insurance, Inc.

Bonding Cost FAQ’s

How much does a surety bond cost?

Costs are a percentage of the full bond amount, which is usually based on your personal credit.

How do you get the best rate?

Providing industry experience, strong personal credit and business/personal financials will help lower your bond rate.

Can I spread out the cost of my surety bond over time?

Yes, in some cases. Premium financing is available to applicants for many surety bonds.

General Bonding FAQ’s

What do you need to know when buying a surety bond?

• You need a claims advocate
• Claims will cost you
• All bonds are not equal
• Choose your surety agent wisely

If you’re required to get a surety bond, it’s to guarantee that you will operate professionally (there are hundreds of different bonds used for many purposes). If you break the rules, a claim can be made on your bond which you’re responsible to pay.

Why do I need a surety bond?

You are required to get a bond because it guarantees you will fulfill your obligations. It’s protection for the public, not you.

 Can I get a surety bond with bad credit?

Yes, absolutely. Don’t let poor credit stand in your way. We specialize in securing bonds at low rates for those with bad credit. Learn more by contacting an agent at Alliance West Insurance, Inc.

Does Alliance West Insurance, Inc. work with credible insurance companies?

Yes, we partner with AM Best A-rated surety insurance carriers approved by the United States Department of Treasury.

How long will it take to get my surety bond?

In most cases it is possible to receive your surety bond in as little as one business day. In some cases, you can even receive your bond on the same day.

How do I know the bond amount to request?

The bond amount required will usually be dictated by the obligee (licensing or other state, federal or local government authority requiring the surety bond). If you are still unsure of your bond amount, send us an email or give us a call and our bond specialists can help determine it for you.

How is surety different from insurance?

Unlike insurance, surety bonds typically are required for the benefit of a third party such as states or consumers rather than the bonded business or individual. Surety is also unique in that it involves a three-party agreement between the bonded entity, the obligee (entity requiring the bond) and the surety company.

Will Alliance West Insurance, Inc. notify me when my bond is due for renewal?

Yes, we proactively alert our customers of upcoming bond renewals. We also strive to lower bond costs whenever possible at the time of renewal.