Your employee sets a cabinet wrong; the cabinet falls from the wall and damages the client's countertop. What should you do?

Your employee sets a cabinet wrong; the cabinet falls from the wall and damages the client's countertop. What should you do?

• A. Claim the damage on your general liability insurance policy
• B. File a workers' compensation claim
• C. Sue the employee
• D. Refuse to cover any damage

Answer: (A)

When a worker’s action causes damage to a client’s property, the business typically relies on general liability insurance to cover the loss. This insurance is designed to respond to third-party property damage and claims arising from your operations. Workers’ compensation covers medical costs and lost wages for employees, not damage to a client’s property, so filing a workers’ comp claim wouldn’t address this loss. Suing the employee isn’t the practical route here because the protection and resolution come through the GL insurance policy, which will handle claim processing, defense if needed, and arranging repairs or compensation. Refusing to cover the damage isn’t appropriate either, since the GL policy exists precisely to cover these kinds of incidents. What to do next: promptly notify the client and your insurer, document the damage with photos, obtain repair estimates, and file a general liability claim so the insurer can coordinate the repair and settlement. This approach protects the client, your business, and ensures the loss is handled through the proper coverage.

When a worker’s action causes damage to a client’s property, the business typically relies on general liability insurance to cover the loss. This insurance is designed to respond to third-party property damage and claims arising from your operations. Workers’ compensation covers medical costs and lost wages for employees, not damage to a client’s property, so filing a workers’ comp claim wouldn’t address this loss. Suing the employee isn’t the practical route here because the protection and resolution come through the GL insurance policy, which will handle claim processing, defense if needed, and arranging repairs or compensation. Refusing to cover the damage isn’t appropriate either, since the GL policy exists precisely to cover these kinds of incidents.

What to do next: promptly notify the client and your insurer, document the damage with photos, obtain repair estimates, and file a general liability claim so the insurer can coordinate the repair and settlement. This approach protects the client, your business, and ensures the loss is handled through the proper coverage.