One heading in your general liability policy is Contractual Liability. Like all of the sections in your Business Owner’s Policy (BOP), it’s important to understand the purpose of this liability insurance, and why your company needs it. Contractual liability is when one party assumes liability on behalf of another through a contract between them. This coverage is supplied in most general liability policies. It can save you thousands of dollars in court fees if you know how this coverage works, as well as how to protect against contractual liability when it occurs. [Read more…]
Why Should a Business Protect Against Contractual Liability?
October 26, 2016 by
Understanding Contractual Liability
May 21, 2015 by
When businesses sign an agreement to work together or lease a property, it often involves signing an indemnity agreement, also known as a hold harmless agreement.
Definition of Contractual Liability
In this agreement, one party promises to assume the liability of the other under specified conditions, which is called contractual liability. If Company A assumes contractual liability for Company B and Company B is sued, then Company A will indemnify (reimburse) Company B for the costs of the lawsuit.
