Does General Liability Cover Settlements?
Sometimes, if the settlement resolves a covered claim and the insurer approves it under the policy terms.
A contract or employment dispute is not covered simply because your business agrees to settle it.
Contact the insurer before agreeing to a settlement. Check consent rules, covered damages, deductibles, retentions, and remaining limits; unauthorized agreements may affect coverage.
Coverage Guides Related to General Liability Insurance
Sources for General Liability Insurance Answers
- Commercial general liability insurance. Insurance Information Institute; What commercial general liability insurance covers; Coverage A, B and C; Additional liability coverages to consider. Accessed 2026-09-25.
- Commercial Insurance Guide. California Department of Insurance; Commercial General Liability; Commercial Automobile; Workers Compensation; Commercial Property. Accessed 2026-09-25.
- Commercial General Liability Coverage Form, CG 00 01 12 07. ISO; specimen hosted by Hiscox; Coverage A I.A pp.1–5; Coverage B I.B pp.6–7; Who Is An Insured II pp.9–10; Limits III p.10; Conditions IV pp.10–12; Definitions V pp.12–16. Accessed 2026-09-25.