For example, if a customer falls on a slippery floor and then sues you, you may be liable because you negligently failed to provide safe premises. As you probably know, when it comes to personal injuries, judges are broadening the scope of what people can sue forand juries are increasingly generous in awarding damages. Because an injured person can collect not only for lost wages and medical bills but also for such intangibles as pain, suffering and mental anguish, a single personal injury verdict against your business has the potential to wipe it out. For that reason, unless you have a very unusual business that has no personal contact with customers, suppliers or anyone else, your insurance program should include liability coverage. Some intentional acts not involving bodily injuries are also usually covered under the liability portions of an insurance policy.
Examples are libel, slander, defamation, false imprisonment and false arrest.
Suppose the government orders your company to clean up a toxic waste problem on your property. This can and does regularly occur even if the pollution occurred years before you bought the property. Most courts that have considered this question ruled that response costs are covered by a liability insurance policy, but a significant minority have ruled otherwise. If you have a business or own property that by any stretch of the imagination could become involved in a toxic waste or pollution problem, try to find out exactly how far your liability coverage extends in environmental situations. Keep yourself informed on this subject.