Question

The high cost of liability insurance has made some people believe that this kind of insurance should be eliminated because the cost is too high for the society. Do you agree with it?

Answer 1

The insurance that protects an individual or business from the risk that they may be sued and held legally liable for something such as malpractice, injury or negligence is known as the Liability Insurance. It covers both the leal costs and the legal payouts for which the insured would be responsible if found legally liable. Coverage for intentional damage and contractual liabilities are typically not covered in these types of policies. Medical practioners and business owners are the ones who typically go in for this type of insurance as they are bound to pay if legally found liable for the injuries of others. Claims shall come anytime as they are exposed to range of liabilities.

Different types of liability insurance are Employer's liability and workers' compensation, indemnity insurance, commercial liability insurance, Director and officer liability coverage, etc. All these insurances are made for the companies and their employees. A company is home for many employees, any unforseen incidents happen and that too anytime. Liability insurance comes very handy to the business owners and the company on the whole. Here, all the employees who want coverage are covered for insurance. This process saves time and money for the owners as all the employees are covered at one time and when a large number of employees are covered at a time, the insurance company too offers premium at dicounted rate as they get premium amount in large numbers. The owners or the business entities are also rest assured that the employees are covered and any untoward incidents will be taken care off by these insurance companies.

Keeping in view the above facts and the usefulness of the liability insurace it will not be proper to say that it should be eliminated because of its cost too high for the society. Even if the cost is high but it covers many people in it and the owners and the employees both are equally benefitted from it. Therefore, I personally do not agree with it.