When was the last time you bought a faulty product? When was the last time received faulty and unfinished service by a business? Do you know of any cases where a company got sued because of faulty products and services? Those are a few questions that everyone can easily answer, because chances are it has happened to everyone at least once.

Businesses and corporations normally try to deliver the best products and services to consumers. However, in reality this doesnt always happen. In fact, a business can very easily get into legal trouble because of faulty products and incomplete services. In this case, liability insurance takes over the task of handling any issue that arises.

Specifically, the insurance company will cover any damages (mainly in the economic form) that may appear because of a lawsuit that is filed against the business. Additionally, the insurance will cover all legal costs.

There are three main types of liability insurance. Although all three belong within the liability insurance bounds, each one has a specific purpose and covers specific cases.

General Liability Insurance: This form of business insurance covers injury claims, property damages or advertising claims. Businesses can survive on this type of insurance only, and it is the most common type of liability insurance for businesses.

Professional Liability Insurance: This insurance covers problems that may arise because of errors, negligence or omissions. Certain professions such as doctors and technology consultants might be obliged to have this type of insurance in some areas.

Product Liability Insurance: This insurance type handles injuries caused to an individual due to a faulty product that was manufactured by the business. The range of coverage, as well as the level of risk, depends on the type of business.