What does general liability insurance NOT cover?

General liability does not cover: injuries to your own employees (workers' compensation covers that), damage to your own property (commercial property insurance covers that), professional errors or omissions (professional liability covers that), auto accidents (commercial auto covers that), or intentional acts.

How much general liability insurance does a business need in New York?

New York commercial leases and construction contracts typically require $1 million per occurrence and $2 million aggregate as a minimum. NYC DOB, NYCHA, and MTA projects often require $2 million per occurrence and $5 million aggregate. The right limit depends on your contract requirements, the nature of your operations, and your exposure to large liability claims.

What is an additional insured on a general liability policy?

An additional insured is a person or entity added to someone else's GL policy who receives coverage under that policy for claims arising from the named insured's operations. Property owners, general contractors, and project owners routinely require subcontractors to name them as additional insureds.

What Does General Liability Insurance Cover?

Q: What does general liability insurance cover?

General liability (GL) insurance covers three main categories: bodily injury to third parties, property damage to third-party property, and personal and advertising injury (such as libel, slander, or copyright infringement). It pays for defense costs, settlements, and judgments up to the policy limits.

What General Liability Insurance Covers

A standard commercial general liability (CGL) policy covers three broad categories of claims made against your business by third parties:

1. Bodily Injury

GL insurance pays for injuries sustained by third parties — customers, visitors, members of the public, or subcontractors — that arise from your business operations or premises. This includes medical expenses, lost wages, pain and suffering, and legal defense costs if the injured party sues. It does not cover injuries to your own employees, which falls under workers' compensation.

2. Property Damage

GL insurance covers damage your business operations cause to someone else's property. If a contractor damages a client's building during renovation work, or a delivery driver damages a customer's fence, the GL policy covers the resulting liability. It does not cover damage to your own property — that falls under commercial property insurance.

3. Personal and Advertising Injury

This coverage addresses non-physical harm claims: libel, slander, defamation, copyright infringement in advertisements, false arrest, and wrongful eviction. For businesses with marketing, social media presence, or media output, this protection is increasingly important.

What GL Insurance Does Not Cover

Understanding exclusions is as important as understanding what is covered:

Employee injuries. Workers' compensation handles this, not GL.
Your own property. Commercial property insurance covers physical damage to your own assets.
Professional errors. If your service causes financial harm to a client due to negligence or error in your professional work, professional liability (E&O) insurance applies, not GL.
Auto accidents. Commercial auto insurance covers vehicle-related liability, even if the vehicle is used for business purposes.
Intentional acts. Deliberate harm is excluded from coverage.
Pollution. Standard GL excludes pollution liability; a separate pollution policy is required for environmental exposures.
Cyber incidents. Data breaches and cyber attacks require a separate cyber liability policy.

How GL Limits Work

A standard commercial GL policy has two key limits:

Per-occurrence limit: the maximum the insurer pays for any single claim or occurrence. Common limits are $1 million or $2 million per occurrence.
General aggregate limit: the total the insurer will pay across all claims during the policy period. Typically twice the per-occurrence limit — so a $1M/$2M policy pays up to $1 million per claim and up to $2 million in total across the policy year.

When project contracts require higher limits than your underlying GL provides, an umbrella policy can stack additional limits on top — activating after the underlying GL is exhausted.

GL Requirements in New York

New York is one of the most certificate-intensive states in the country. Property owners, GCs, and government agencies routinely require contractors to carry specific GL limits and name them as additional insureds on the policy before work begins.

Standard commercial leases: typically require $1M/$2M GL with the landlord named as additional insured.
NYC Department of Buildings (DOB) projects: require $1M per occurrence minimum, often higher based on project scope.
NYCHA projects: require $2M per occurrence, with NYCHA named as additional insured and specific description-of-operations language on the COI.
MTA projects: require $5M per occurrence or combined umbrella limits in many cases.

The certificate of insurance (ACORD 25) is the document that proves GL coverage to a third party. For a full breakdown of what a COI must contain and the most common certificate mistakes, see the broker's guide to certificates of insurance.

Additional Insured Endorsements

An additional insured endorsement extends GL coverage to a named third party — a property owner, GC, or project developer — for claims arising from the named insured's operations. Additional insured status is not automatic; it requires a specific endorsement on the underlying policy, not just a mention on the certificate. A COI showing additional insured status without an actual endorsement on the policy is inaccurate and creates significant E&O exposure for the broker who issued it.

For agencies managing high COI volumes with additional insured requirements, Clermont Global's team verifies endorsement status before issuing any certificate showing AI coverage. See how we handle commercial lines certificate processing at scale.