More than 80 million lawsuits are filed in U.S. courts annually.That doesn’t mean your business will be the target of one, but itdoes suggest the need to evaluate your business’s legalliability.
As your business grows, you should occasionally reassess yourexposure to liability claims. Growing companies naturally becomemore exposed to various kinds of risks. For instance, liabilityclaims resulting from employment, such as charges of discriminationor wrongful termination, tend to increase as your work force grows.Following are some of the major areas of liability exposure youshould evaluate from year to year:
- Employment. The larger and more diverse your work force,and the more turnover you have, the greater your exposure toemployment-related liability lawsuits will be.
- Accidents and injuries on your premises. If a deliveryperson trips on your steps and breaks a leg, you may be sued formedical and other costs.
- Vehicle-related liability. If an employee driving acompany car gets in an accident, the company could be held liablefor damages and injuries.
- Product-related liability. If you manufacture any typeof product, you may be liable for injuries or accidents resultingfrom poor workmanship or labeling.
- Errors and omissions liability. You may be sued fordamages resulting from a mistake in the work your company does if,for instance, you accidentally delete a customer’s importantcomputer file.
- Directors and officers liability. If you have a board ofdirectors, they may be held personally liable for actions taken bythe company.
When it comes to liability, every company is different. Forinstance, a restaurant that uses hot-oil fryers may be considered adifferent liability risk by an insurance company than one thatbakes its food in ovens. By giving your business a legal checkup,you’ll decrease the chances of your particular liability proving tobe a disastrous weakness.
