The best way to understand the need for general liability insurance is to discuss a real life scenario. Let’s say that a customer drops some of your product on the floor and doesn't mention it to anyone. Then, someone slips, falls, and is injured on your property. Later they sue your business for negligence or medical costs. If you do not have general liability insurance, are you financially able to make these large payments should the judge find in the victims favor? Similar to workers compensation, general liability insurance is peace of mind, it’s knowing that you have backup when the unpredictable occurs.