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Bodily Injury Liability: Everything You Need to Know

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If you’re a business owner, you know that protecting your company and employees from liability is critical. And when it comes to operating vehicles as part of your business, having the right insurance coverage is essential. That’s where bodily injury liability insurance for commercial businesses comes in.

This type of insurance coverage protects your business from the financial fallout of injuries sustained by others in an accident for which your company is found responsible. Whether you’re a small business owner with a single vehicle or a large corporation with a fleet of cars and trucks, understanding bodily injury liability insurance can help you make informed decisions and protect your company from costly legal and financial repercussions. In this article, we’ll dive into everything you need to know about commercial bodily injury liability insurance.

What is Bodily Injury Liability?

Bodily injury liability is a type of insurance coverage that protects the policyholder from financial losses arising from injuries sustained by other people in an accident where the policyholder is deemed at fault. This insurance coverage typically applies to bodily injuries, such as medical bills, lost wages, pain and suffering, and other damages related to the injuries sustained in the accident. 

Bodily injury liability insurance is commonly included in car insurance policies, both for personal and commercial use. For commercial auto insurance, bodily injury liability coverage is typically required in most states since businesses face greater liability exposure due to the nature of their operations. 

The amount of bodily injury liability coverage required or recommended may vary depending on the state, the type of vehicle, and the nature of the business. It’s important to carefully consider the amount of coverage needed and to consult with an insurance professional to determine the appropriate level of protection. 

What Does Bodily Injury Liability Cover?

Bodily injury liability coverage is designed to cover the expenses associated with injuries sustained by other people in an accident for which the policyholder is found to be at fault. The coverage typically includes:

  • Medical expenses: This coverage pays for the cost of medical treatment for the injured parties, such as hospital stays, surgeries, doctor visits, and other related medical expenses. 
  • Lost wages: If the injured parties are unable to work as a result of their injuries, bodily injury liability coverage can help cover their lost wages. 
  • Pain and suffering: This coverage can help compensate the injured parties for physical pain, emotional distress, and other intangible damages caused by the accident. 
  • Legal fees: Bodily injury liability coverage can help cover the cost of legal fees associated with defending against a lawsuit brought by the injured parties. 

Bodily injury liability coverage only covers injuries sustained by others in an accident for which the policyholder is found to be at fault. It does not cover the policyholder or their employees’ injuries or damages to their vehicle or property. For that type of coverage, policyholders need to have workers’ compensation insurance included in their insurance policy. 

How Bodily Injury Liability Works

From a commercial insurance standpoint, bodily injury liability insurance works in much the same way as it does for personal auto insurance. However, the coverage applies to accidents that occur while operating vehicles as part of a business or commercial operation. This can include accidents involving delivery vehicles, company cars, and other types of commercial vehicles. 

In the event of an accident for which the commercial policyholder is found to be at fault, the injured people may file a claim with the policyholder’s insurance company. If the claim is covered under the policy, the insurance company will pay out the policy limits to the injured parties or their representatives to cover the damages and expenses associated with the injuries sustained in the accident. 

What is the Difference Between Property Damage Liability and Bodily Injury Liability?

Property damage liability and bodily injury liability are both types of liability coverage that are commonly included in auto insurance policies. However, they cover different types of losses and expenses. 

Property damage liability insurance is designed to cover the cost of damages that the policyholder causes to someone else’s property in an accident for which the policyholder is found to be at fault. This can include damage to another vehicle, as well as damage to buildings, fences, and other types of property. Property damage liability coverage typically has a separate policy limit from bodily injury liability coverage typically has a separate policy limit from bodily injury liability coverage. 

On the other hand, bodily injury liability insurance is designed to cover the cost of injuries that the policyholder causes to other people in an accident for which the policyholder is found to be at fault. This can include medical expenses, lost wages, pain and suffering, and other related expenses. Bodily injury liability coverage typically has a separate policy limit for each person injured in the accident, as well as an aggregate limit for all injuries sustained in the accident. 

Both types of coverage are important to have in an auto insurance policy to protect against the potential costs associated with an accident from which the policyholder is found to be at fault. 

How Much Bodily Injury Liability Should You Have?

The amount of bodily injury liability insurance a business should have can vary depending on several factors, including the nature of the business, the size of the fleet, and the state in which the business operates. However, as a general rule of thumb, commercial auto insurance policies should have higher liability limits than personal policies, since businesses face greater liability exposure. 

Most states have minimum liability insurance requirements for commercial vehicles, which businesses are required to meet. However, these minimums may not be sufficient to cover the potential costs associated with a serious accident. AAs a result, businesses may choose to purchase higher liability limits to provide greater protection in the event of an accident. 

When determining the appropriate amount of bodily injury liability coverage for your business, it’s important to consider the potential damages and expenses associated with an accident. This may include medical expenses, lost wages, pain and suffering, and legal feed, among other costs. Businesses should also consider the potential for lawsuits and judgements that may exceed their insurance coverage limits.  

How Much Does Bodily Injury Liability Insurance Cost?

The cost of commercial bodily injury liability insurance can vary depending on several factors, including the size of the fleet, the nature of the business, the coverage limits selected, and the state in which the business operates. Other factors that can impact the cost of bodily injury liability insurance include the driving history of the business’s employees, the type of vehicles being used, and the frequency and severity of claims. Additionally, businesses may be able to lower their insurance costs by implementing risk management strategies, such as driver training programs and regular vehicle maintenance. On average, commercial auto insurance policies that include bodily injury liability coverage can range from a few hundred dollars to several thousand dollars per year. 

Let us help you protect your business with bodily injury liability insurance and keep your mind at ease. At Tivly, our goal is to help you find protection for your business as efficiently as possible by matching you with the right insurance provider. Simply give us a call at 877-907-5267 or complete the form above and one of our specialists will contact you right away.

Reviewed By: Andrea McKinney, MBA, Licensed Agent

Related Articles: General Liability Insurance, Commercial Auto Insurance

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