Small-business owners face the risk of lawsuits just by figuratively hanging that “Open for Business!” sign on the door. After all, accidents beyond your control can leave a customer hurt or cause property damage, which can lead to expensive lawsuits. Good thing there's General Liability Insurance, which helps small businesses combat lawsuits that could leave them penniless.
Check out these four cases where General Liability Insurance could have spared real-life businesses from financial ruin.
General Liability Lawsuit #1: Goldilocks No More
Aspiring Brazilian model Myrella Ikeda went to the celebrity-favorite J. Sisters Salon in search of a new look for an upcoming magazine shoot. According to The New York Post, stylist Antonio Luis Rosa allegedly used an organic product in Ikeda’s blonde hair that caused painful burning. Ikeda left with choppy, thin hair and chemical burns on her scalp. Definitely not the stylish look she was going for.
Ikeda filed a lawsuit against the Manhattan salon for $1.5 million. Salon co-owner Jonice Padilha purportedly apologized, but says the hair salon can’t be held responsible for the stylist’s actions. Even so, J. Sisters better have a solid General Liability Insurance policy to pay court costs and any damages owed to Ikeda in the lawsuit.
General Liability Lawsuit #2: Wildfire Woes
An unforgiving wildfire ripped its way across 400 acres near Carlsbad, California, leaving 10 condominiums, five houses, and two commercial buildings in ruins. Local investigators traced the fire’s origin to the seventh-hole fairway of the Omni La Costa Resort and Spa. It’s unknown what actually triggered the blaze. According to the New York Times, about a dozen residents whose property or possessions were destroyed by the wildfire are filing a lawsuit against the resort.
The lawsuit accuses the resort of failing to implement best practices in operating machinery, training employees, and planning to deal with fires. This case cites professional negligence, which is certainly a job for Professional Liability Insurance. But the residents are also seeking property damages for lost homes, possessions, business losses, displacement costs, and personal injuries. If Omni La Costa Resort and Spa is found responsible for the fire, the resort will need General Liability Insurance to pay for property damages.
General Liability Lawsuit #3: Something Moldy This Way Comes
Amanda Bonnen, a 25-year-old renter, took to Twitter to vent her grievances with her apartment’s unsatisfactory condition. She tweeted, “Who said sleeping in a moldy apartment was bad for you? Horizon Realty thinks it’s okay.” The management company, Horizon Realty Group, didn’t react kindly to criticism and filed a lawsuit for $50,000 in damages against Bonnen.
In the advertising injury case, Horizon Group v. Bonnen, the realty group argued that Bonnen damaged its professional reputation. Bonnen’s lawyers successfully argued that her tweet lacked context to meet the legal standards for libel, and the case was dismissed.
If your small business faces a social media defamation claim like Bonnen, you have to hire a lawyer to prepare a defense and respond to the charges – whether the case goes to trial or not. General Liability Insurance can pay for lawyer fees and court expenses. For more on advertising injury, read our social media eBook Tweet or Twibel: The Small-Business Owner’s Guide to Advertising Injury.
General Liability Lawsuit #4: Beware Black Friday
Everyone knows about frantic mobs on Black Friday desperately seeking door-buster deals. Throngs of shoppers pushing into stores have caused countless injuries (some fatal), as Amanda DuVall experienced firsthand.
DuVall waited three hours on Black Friday at a Wal-Mart in Kansas, and when the store opened, she claims she was shoved, knocked to the ground, and trampled by other customers in the frenzy for a cheaply-priced tablet. According to Insurance Journal, DuVall filed a lawsuit against Wal-Mart for $75,000 in damages, claiming the retail giant didn’t do enough to protect its customers.
Because small-business owners don’t have the same kind of resources as a major retail chain, General Liability Insurance is a must-have policy. Your coverage can protect your business from classic “slip-and-fall” lawsuits, which can be unexpected and extremely pricey.