General Liability vs. Product Liability
General liability and product liability are two of the most common commercial coverages, and they are easy to confuse because they often overlap inside the same standard policy. This page explains what each one addresses, how they fit together in a Commercial General Liability form, and where to look to confirm your product exposure is covered.
At a glance
| General Liability GL | Product Liability PL | |
|---|---|---|
| What it covers | Bodily injury and property damage from your premises and ongoing operations | Bodily injury and property damage caused by a product you made, sold, or distributed |
| Typical trigger | A slip-and-fall on your premises or damage caused during your work | A defective or dangerous product harms a user after it leaves your control |
| Where it lives | The Commercial General Liability (CGL) policy | Usually the products-completed operations part of the same CGL policy |
| Who buys it | Nearly any business with premises or operations | Manufacturers, wholesalers, distributors, and retailers |
| Common exclusions | Professional services, auto, and employee injury | Recall costs, pure economic loss, and expected or intended harm |
Where the Line Falls Between Them
The clearest way to think about this is that Product Liability is usually a specific part of a broader General Liability policy rather than a separate purchase. A standard Commercial General Liability (CGL) form includes both premises and operations coverage and products-completed operations coverage.
The trigger is what differs. General liability generally responds to harm tied to your location or your ongoing activities, while product liability responds to harm caused by a product after it has left your control. A retailer that manufactures nothing still has product exposure, because selling a defective item can create liability.
Why the Distinction Matters
Insurers often set a separate products-completed operations aggregate limit, so product claims draw from a different pool than premises claims. Businesses that make or sell goods should confirm that limit is adequate on its own.
Coverage Part Declarations
Look at the CGL declarations for separate limits labeled General Aggregate and Products-Completed Operations Aggregate.
Definitions Section
The policy defines your product and your work, and those definitions determine whether a loss is treated as a product claim.
Exclusions and Endorsements
Check for endorsements that limit or exclude specific products, or that remove products-completed operations coverage entirely.
What it looks like on a real claim
Example 1 — Customer slips in your store
A customer slips on a wet floor in your San Diego retail shop and fractures a wrist, incurring about $18,000 in medical bills.
Responds — a premises bodily-injury claim falls squarely under general liability
Does not respond — no product defect is involved
Example 2 — Defective product injures a user
A blender your company manufactured overheats and burns a customer's hand at home, leading to a roughly $40,000 claim.
Does not respond to the product defect itself
Responds — the injury was caused by your product after it was sold
The bottom line
General liability and product liability overlap far more than their names suggest. In most cases they live in the same CGL policy, with product exposure sitting inside the products-completed operations coverage rather than in a standalone contract.
For a California business, the practical question is not whether you have one or the other, but whether your CGL form includes products-completed operations coverage and whether its separate aggregate limit fits the goods you make or sell. Reviewing the declarations and definitions is the surest way to know.