Operating a business can be serious business.
Just a moment of inattentiveness, and you could be facing a lawsuit from a customer, employee or visitor who was injured in your store. Think about it…
How many business owners know what premises liability is until after the fact?
By the time that a customer or employee has been hurt on their premises, owners are often already facing the stressful and costly process of a legal defense. And in most cases, owners are already scrambling to find the funds for legal expenses.
Let’s take a step back for a minute.
The good news is that knowledge is power. Premises liability insurance is only one component of a holistic legal strategy for any business owner. Knowing what to look out for, and what actions to take, is critical in avoiding potentially expensive mistakes in the first place.
In this article we are going to cover all the important topics when it comes to navigating business premises liability including:
- Business Premises Liability 101
- Common Types of Premises Liability Claims
- How to Protect Yourself as a Business Owner
- What to do When an Accident Happens
Business Premises Liability 101
If you’ve heard the phrase premises liability before, but aren’t really sure what it means, let’s break it down.
Business premises liability refers to the legal responsibility that property owners have if someone is injured on their property.
If someone gets hurt at your place of business because of unsafe or defective conditions on the property… It could be on you.
This applies to any type of business that has customers or employees that come onto the property. Retail businesses, restaurants, offices, warehouses, the list goes on. Your customers and employees have a reasonable expectation of safety when they visit your business.
One thing that most people don’t know is…
Property owners have a legal duty to maintain safe conditions on their property. This could include anything from fixing broken staircases to mopping up spills in a timely manner. If the owner of the property fails to uphold their duty of care, and someone is injured as a result, they can be sued for damages.
In fact, 95% of personal injury lawsuits get settled prior to trial. That means you could be looking at thousands of dollars in settlement costs even if you believe you are in the right. Prevention is key.
Of course, when an accident does happen, business owners often must work with both personal injury specialists as well as a criminal defense lawyer if criminal negligence charges are at issue in more serious injury cases. The legal waters can get murky, fast.
Common Types of Premises Liability Claims
Curious to know how most people get sued as business owners?
Slip and fall accidents are at the top of the list. These accidents alone make up over 25% of all injuries across all industries. Think wet floors, icy sidewalks, uneven surfaces, poor lighting.
There is more…
Here are some other examples of the most common premises liability claims:
- Inadequate security leading to assaults or theft
- Falling merchandise or equipment
- Elevator and escalator accidents
- Exposure to toxic chemicals
- Dog bites on business property
- Swimming pool accidents
- Parking lot incidents
In fact, the median award in premises liability cases is $90,000. This can be devastating to most small businesses. It’s also worth noting that this is the median award. Some awards can be much higher depending on the circumstances.
Negligent Security Claims
A type of claim that seems to blindside business owners most often is negligent security.
If someone is attacked or robbed on your property, and you don’t have adequate security measures in place… You could be liable. This includes things like proper lighting, working locks on doors, security cameras, trained security personnel when necessary.
Here’s an example.
Say a customer parks in your poorly lit parking lot and is assaulted by another party because no security personnel are on site. They could claim that you did not provide a safe environment for your customers. These types of claims are on the rise, particularly for businesses located in higher-crime areas.
How Can Business Owners Protect Themselves?
Now that we know some of the most common ways business owners can be held liable for injuries on their premises, let’s talk about prevention.
Preventing accidents from happening in the first place can be relatively simple for most businesses.
Inspect Your Property Regularly
One of the best ways to prevent accidents from happening is by regularly inspecting your property. Walk through your place of business at least once a week and look for potential hazards.
Are there any loose floor tiles? Broken handrails? Food spills that haven’t been mopped up? Repair these hazards as soon as possible, or at the very least put up warning signs and address them promptly.
A checklist is a good way to make sure that you don’t miss anything. Some items to look for include:
- Clean, dry floors
- Broken steps/elevations
- Adequate lighting in all areas
- Clear walkways, no tripping hazards
- Proper warning signs
- Employee safety training
Keep Good Documentation
Documentation is your friend. Keep records of all property inspections, repairs, and maintenance issues. If someone later claims that you were negligent in maintaining your property, this documentation will be vital.
Insurance Coverage Is Critical
General liability insurance is a must for every business. This insurance should cover premises liability claims.
Don’t skimp on insurance coverage. One lawsuit could easily wipe out a small business without the proper coverage.
Your general liability insurance should cover:
- Medical expenses for the injured party
- Legal defense costs
- Settlement payments or court awards
- Property damage claims
Check your coverage annually, and as your business grows, increase your limits.
Train Employees
Your employees can be your first line of defense in preventing premises liability claims.
Train them to recognize and report hazards. If they see a spill, they should know how to clean it up immediately. Train them how to use wet floor signs and when to call for maintenance.
Hold regular safety meetings with your employees. Safety is not just about avoiding lawsuits, it’s about protecting the safety of others. When your employees understand the “why” behind safety procedures, accidents happen less frequently.
What to do When an Accident Happens
Even if you have all the best safety procedures in place, accidents can still happen. And in those cases, knowing what to do immediately after an accident can help protect your business.
First and foremost, check on the injured person and call for medical help if needed. Do not admit fault or promise to cover expenses at the scene of the accident.
Your immediate action plan should be to:
- Provide first aid (if appropriate)
- Document the scene with photos and written notes
- Get contact information from any witnesses
- File an incident report immediately
- Notify your insurance company within 24 hours
Documentation is critical. Take pictures of the accident scene from multiple angles. Write down exactly what happened while it is still fresh in your mind. Get statements from witnesses as soon as possible.
Working With Legal Professionals
As soon as possible after an accident occurs, notify your insurance company and lawyer.
You don’t have to face this alone. Your insurance company will be able to walk you through the process. They will assign an adjuster to handle the claim and will be your point of contact for communications with the injured party.
If the claim becomes more complex, or if serious injuries are at issue, you will want to retain an experienced personal injury law firm to protect your interests every step of the way.
Wrapping it up
Business premises liability is no joke.
All property owners are at risk of lawsuits from people who are injured on their property. But with proper precautions, employee training, good insurance coverage, and the right legal counsel, the risk of being held liable for these types of accidents can be greatly reduced.
Be proactive. Don’t wait until someone is injured to start thinking about safety. Regular inspections, timely repairs, and good recordkeeping are key.