Quora Answer: What Happens if I Get Sued & My Business Liability Insurance Will Not Pay the Plaintiff?

The following is my answer to a Quora question: “What will happen if I get sued, and my business liability insurance will not pay the plaintiff?”

If your business liability insurance will not pay the plaintiff, it can either mean that the matter you were sued successfully by the plaintiff was not covered by your liability insurance, or that they have established, through the courts, that you were liable due to negligence, criminal conduct, or any act that would negate your liability insurance.   In such a case, you have the option of appealing to a higher court, if you feel that you have a case, or seeking an out of court settlement with the plaintiff to cover the damages.  If you cannot cover the damage award, the alternative would be to file for bankruptcy, seek funding through loans, or getting in an external investor.