How General Liability Insurance Safeguards Your Business From Costly Claims

Ray Cogan

General Liability Insurance protects your business from major exposures

Running a business involves more than just offering great products or services—it means protecting your enterprise from the unexpected. Whether you’re welcoming clients on-site, transporting goods, or engaging in advertising campaigns, risks are ever-present. This is where general liability insurance becomes a vital shield for businesses.

General liability insurance (often called commercial general liability or CGL) is designed to protect your business from major exposures such as:

Bodily injury to someone (for example, a customer slips on your premises)
Property damage caused by your business operations
Personal or advertising injury (such as slander, libel, or false advertising)

For Maryland businesses interacting with customers or the public, general liability coverage is not only recommended. It is required by leases, contracts, or licensing rules. ***

How General Liability Protects Your Business from Costly Claims

Legal Defense and Settlement Costs. If a claim or lawsuit is filed against your business, general liability insurance typically covers defense costs, settlements, or judgments—up to your policy limit. This can be the difference between staying open and shutting down.
Third-Party Injury & Property Damage Coverage. Suppose a visitor is injured on your property or you accidentally damage a client’s property in the course of work. A general liability policy protects you from paying out of pocket for injuries or damages that result.
Advertising & Personal Injury Coverage. Your business may face liability not just for physical accidents but also for non-physical harm—such as when marketing claims trigger a dispute, or someone alleges you misrepresented your services. CGL policies can cover these scenarios.
Contract & Licensing Compliance. Many Maryland business contracts, leases, and licenses require proof of liability insurance. For example, contractors in Maryland must maintain a minimum $50,000 general liability insurance to hold a license. Justia Law Without it, you can face contract rejections or license suspensions.
Peace of Mind Leading to Growth. When you know you’re protected, you can focus on growing your business rather than worrying about potential lawsuits. General liability insurance enables you to take on clients, bid confidently, and expand with less risk.

Even though general liability insurance is not legally required across the board in Maryland, it’s considered foundational—especially for businesses with public exposure. Per Maryland business insurance resources:

“General liability insurance covers the most common business risks, including customer property damage and injuries… most commercial leases require this business liability insurance.”
Given the varied business environment in Maryland, from small service firms in Frederick County to waterfront operations in Annapolis, having a strong liability policy helps you navigate everything from slip-and-fall risks to client lawsuits with confidence.

What to Look for in a General Liability Policy

Adequate Limits. Ensure limits are sufficient for your industry; small businesses often start at $1 million per occurrence.
Coverage Scope. Confirm that bodily injury, property damage, products/completed operations, and advertising injury are included.
Additional Endorsements. Consider endorsements for your niche: e.g., vendor operations, subcontractor liability, and special event coverage.
Claim Support & Defense Costs. Make sure defense costs are covered outside the limits rather than eating into your policy limits.
Bundled Options & Discounts. Many Maryland insurers offer “Business Owners Policies” (BOPs), bundling general liability with property insurance for savings.

Common Costly Claims & How CGL Helps

A retail customer slips on a wet floor and sues for medical bills and lost wages. CGL would cover settlement and defense.
A tradesperson accidentally damages a client’s expensive equipment during a job. CGL can cover repair costs and legal defense.
An advertising campaign includes unfair claims and leads to a competitor’s lawsuit. CGL covers personal and advertising injury.
Leases require proof of liability insurance before you can move into a commercial space. CGL makes you eligible.

Each of these scenarios illustrates how a single incident can financially strain—or end—an unprotected business. A strong general liability policy acts as your financial safeguard.

If you operate in Annapolis or Frederick, you face unique risks from heavy tourism-driven businesses and waterfront operations in Annapolis to growing commercial service firms in Frederick County. These markets increase your exposure to customers, clients, and public spaces—exactly where general liability coverage matters most.

At Lindquist Insurance, we specialize in helping business owners in the Annapolis and Frederick, MD area secure the right general liability protection designed for their operations and industry. Call us today for a customized review and quote. Let’s safeguard your business together so you can focus on growth, peace of mind, and serving your customers with confidence.

We serve the Frederick and Annapolis, MD area.

*** Visit the OCMI Workers' Comp website for more information.

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