What Is Premises Liability Insurance? (In 2023)

What Is Premises Liability Insurance?

Are you looking to find out what is premises liability insurance? Or protect your business and yourself from uncertain accidents? Premises liability insurance ensures the safety of your business. Understand how premises liability insurance can provide the ultimate protection for your property.

A premise’s liability policy covers accidents at your business. The location of your business sometimes means the location of your office. 

Moreover, it includes your office parking lot, the paths leading to your building, and even the land. So how do you protect your customers as a business owner?  Also, management liability insurance is good for your business officers.

First, you can protect your business with the right policy.

What Does the Premises Liability Insurance Cover

The following are some of the benefits:

  • Bodily injury: 

It can cover medical expenses for someone injured on your property.

  • Third-party property damage: 

Suppose your shopping cart hits someone’s car. You can be liable for the damage because it happened on your property.

  • Defense costs + legal settlements: 
Defense costs + legal settlements: 

Your policy firm covers settlement costs if a customer sues you for the injury.

  • Medical costs: 
Medical costs

An injured client’s policy will pay medical expenses up to the policy limits.

What Isn’t Covered by a Premises Liability Insurance Policy?

In most cases, premises liability will cover slip and fall accidents, but not in the following conditions:

  • The policy does not cover off ladders by your employees.
  • Commercial property policy covers damage to your property.
  • A professional liability policy covers a physician’s misdiagnosis of a patient. 

Who Does Premises Liability Coverage Protect?

Visitors to your business are legally entitled to a safe environment, whether you own or lease the property. So who qualifies as a visitor?

  • Invitee: 

A person you specifically invite to your property (for example, a customer). You have to make sure they’re safe. 

  • Licensee: 

People you permit to enter your property, such as delivery persons, utility workers, or postal workers, even if they didn’t ask. While these people must protect against hazards, you are still responsible for ensuring your property is safe.

  • Trespassers: 

People who aren’t invited into your business. It isn’t your duty to protect them if they are trespassing.

You are liable for injuries caused to invitees and licensees on your property. You’ll have to pay for their medical bills and legal settlements. That’s why this policy is essential. 

Who handles the Accident?

Accidents in a common area could lead to your leaseholder being liable. You may be liable for the building AND parking lot if you lease a building. You may still be responsible despite an injury on the way into the store.

Furthermore, check your leaseholder agreement with care. Sometimes it is clearly stated who is responsible. For example, in an accident, the property owner is responsible, not you, if he maintains the parking lot.

What Does General Liability Insurance Cover?

When your customers are on your property, the general liability policy protects them. 

Also, the policy cares about your business if you’re sued for bodily injury, property damage, or personal injury (libel, slander). 

Example: You run a small local grocery store. Even the slightest wet floor can cause customers to slip and fall despite your best efforts. Your policy firm will pay for their medical bills and settlement costs if they have a general or premises liability policy.

Do You Need Premises Liability Coverage?

Policies that cover general liability only sometimes cover premises liability settlements. Consider this policy if your business is at risk for accidents. The property owner may need you to get this coverage as well.

How to Reduce Premises Liability Claims

Make every fair effort to keep your property safe for visitors. So what does it look like?

  • Ensure your parking lot and walkways are ice- and debris-free after a storm. 
  • Guardrails and sturdy stairs are vital.
  • Clean up spills or accidents whenever possible and place “wet floor” signs.
  • Put up signs warning clients of potential hazards.
  • Make sure elevators and escalators work properly.
  • Make sure your property is leak-free.
  • Be on the lookout for chemical spills and other toxins.
  • Keep all floors clear of debris, loose flooring, and other dangers.
  • Provide adequate security (such as security guards, cameras, locks, etc.) whenever possible.
  • Ensure you take all possible cares to prevent swimming pool accidents if you own an apartment building with a pool.
  • To determine your level of risk, work with an insurance agent. To protect your small business, they can help.


Businesses and property owners can get premises liability insurance to cover injuries and damages. Protect your properties with customers, visitors, and tenants by insuring them. 

In addition, a premises liability policy can protect businesses from financial ruin in the event of an accident, injury, or property damage. 

Frequently Asked Questions 

Who needs premises liability insurance?

Property owners should have a premises liability policy, including businesses, landlords, homeowners, and tenants. It is vital for businesses with a lot of foot traffic, such as retail stores, restaurants, and entertainment venues.

What does premises liability insurance cover?

It covers bodily injury and damage claims on the insured property, such as slips and falls. The policy may cover medical expenses, legal fees, settlements, and judgments.

Are there any exclusions or limitations to premises liability insurance?

Reviewing the policy details for any exclusions or limitations with care is crucial. For example, a common exclusion in premises liability insurance is intentional acts, employee injuries, and property damage. Again, a professional can help you understand the specifics of a policy.

How much premises liability insurance coverage do I need?

The coverage needed depends on the property’s size, nature, and potential risks. To determine the appropriate coverage limit, consult a policy agent or broker.

Is the premises liability policy bundled with other policies? 

General liability and property policy are often bundled with a premise’s liability policy. Multi-coverage bundles can reduce costs and simplify policy.

How can I get premises liability insurance?

You should contact policy firms or independent agents/brokers for this policy. They will assess your needs, provide quotes, and guide you through the application.

What is premises liability insurance?

So, this policy aims to protect property owners or businesses from financial liability. In general, it covers legal costs, medical bills, and potential judgments or settlements.