Good risk management can reduce the chance your business is sued, but it can never remove the risk entirely. You or someone on your team can make a mistake that injures someone or damages property.
A mistake could also harm the reputation or privacy of a client, a competitor or a member of the public. When that happens, you may be legally responsible for the damages.
Depending on the harm done, a lawsuit could bankrupt a business. Even if you're cleared, a determined plaintiff can keep you in court for a long time at significant cost. Liability insurance pays for your defense and protects your assets.
