How does a Commercial General Liability policy primarily protect a business?

A Commercial General Liability (CGL) policy primarily protects a business by covering claims made by third parties for bodily injury and property damage. This is crucial for businesses as it safeguards them against lawsuits or claims arising from incidents that occur on their premises or as a result of their operations.

For instance, if a customer slips and falls in a retail store and sustains injuries, the CGL policy would cover the associated legal expenses and potential settlements. Similarly, if a product manufactured by the business causes damage to a customer's property, the CGL policy would address claims related to that property damage.

This type of coverage is fundamental for businesses, as it helps manage the risks associated with daily operations and can protect the company's financial stability against unforeseen liabilities. The policies often include defense costs, which can accumulate even if the claims are unfounded, further emphasizing the importance of this coverage in the business landscape.