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What Is Liability?

In insurance, liability refers to a sum of money that you or your company owes a third party due to damages you may have caused and are legally obligated to pay.

Liability definition.

What Is Liability Insurance?

The definition of liability insurance is a policy purchased to protect you and your business from the out-of-pocket cost of claims relating to third-party bodily injury, property damage, and more

You may have also heard it referred to as “commercial general liability,” “general liability,” “indemnity insurance,” or “public liability insurance.”

What Does Liability Insurance Cover?

Liability coverage protects you from third-party bodily injury, property damage, and personal and advertising injury claims arising from your business operations.

Here are just a few examples of claims that could be covered by a liability insurance policy:

  • A customer trips over your extension cords at a food truck rally and injures themselves. They sue you for medical expenses and to recover lost wages.
  • While setting up a table for your catering service at a wedding venue, the legs of the table scratch the wood floor and leave large gouges. The venue holds you liable to pay for the damages.
  • You have a bad time as a vendor at a food festival and write about it online. The festival then sues you for libel.

How Much Does Liability Insurance Cost?

Food Liability Insurance Program (FLIP) offers liability insurance coverage for food and beverage vendors starting from $25.92 a month or $299 a year. 

The final cost of your premium is affected by several factors, including your:

  • Business operations
  • Gross sales
  • Geographical location
  • Products sold


Adding additional coverages to your policy, like tools and equipment or cyber liability insurance, can increase the cost of your premium as well. 

However, having the right coverage can save you more money in the long run because your business will be properly shielded against the claims you’re most likely to face.

How Do I Get Liability Insurance for My Small Business?

FLIP makes it super easy to get your liability insurance policy with our simple online application. Most people can complete it in 10 minutes or less, saving you time and allowing you to focus on running your business!

Just follow these steps to get insured today:

  1. Start your application
  2. Select your business activities and fill out the necessary fields
  3. Add any additional coverages you need to your policy
  4. Get your free quote and finish checking out!


Once your application has been processed, you’ll have instant access to your Certificate of Insurance through the user dashboard.