If you own a business, you're already well aware of the potential legal liability you incur simply by having employees and customers present in your building on a daily basis. However, in states without limits on personal injury settlements, this liability can reach dollar amounts you would never have expected. Protecting yourself from these types of lawsuits is one of the savviest things a business owner can do, and can be crucial to the long-term success of the business. Read on to learn more about how to protect your business from a slip-and-fall or other premises liability lawsuit.

Avoid negligence

This may seem an obvious tip -- few business owners set out to be negligent. But in states that permit punitive damages in personal injury or slip-and-fall cases, negligence is often key.

In a typical slip-and-fall lawsuit, the injured person (or plaintiff) will sue you or your company (the defendant) for any medical expenses or lost wages incurred as a result of the accident. These damages are recoverable simply by the plaintiff's proof that he or she was injured in a building that your company owns. However, if the plaintiff can show that his or her injury was caused by negligence -- for example, if several employees had been informed about a spill but had refused to clean up the mess before it caused injury -- the plaintiff may be able to recover punitive damages as well.

Most states do not limit the amount that can be recovered through punitive damages, and these damages need not be tied to any costs incurred on the plaintiff's behalf. A recent landmark product liability lawsuit resulted in a jury award of compensatory damages of $16.9 million and punitive damages of $23.6 billion. Although it's unlikely that such a monetary judgment would ever be awarded against the typical small business, this disparity in compensatory and punitive damages shows that negligence or intentional misrepresentation of danger can cost your business a staggering amount of money.

To avoid a judicial finding of negligence, be sure all employees are aware of safety regulations and act quickly to ensure customer safety (as well as their own safety). You might wish to have a local Occupational Safety and Health Association (OSHA) representative conduct an inspection of your business to ensure that you are complying with all applicable safety laws.

Ensure that your business insurance policy covers the cost of legal assistance

Obtaining a "pre-paid" attorney won't prevent you from being sued, but it can save you thousands in legal fees if you are. Check your business insurance policy to ensure that it covers any legal services associated with an insurance claim. This will allow you, upon receiving notice of a lawsuit, to forward the paperwork to your insurance company and let them handle the rest. Although you may still need to attend depositions or settlement negotiations, having your insurance company handle the majority of issues with a pending slip-and-fall lawsuit will not only save you money, but ease your stress levels.

Consider investing in security and surveillance equipment

Unfortunately, some slip-and-fall lawsuits (even those in which a settlement is eventually reached) involve fraudulent allegations or even outright lies by the plaintiff. If your building has a number of nooks and crannies that can't be easily seen by employees and aren't monitored by security cameras, one of these unscrupulous customers may be able to successfully stage an accident -- and force you to pay the price.

Guarding against this type of fraudulent lawsuit can be accomplished simply by limiting customer access to out-of-the-way areas and by ensuring that all areas accessible by customers and staff are adequately monitored, whether by security personnel or a security camera.

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