Public Liability Insurance - a useful business guide
Some people believe that public liability insurance is only valuable if you are a big business. This is simply not true. Whether you are a contractor, home worker, or provide home services, public liability cover could be essential insurance for you.
This guide will provide you with an excellent insight into public liability insurance and how your business could benefit from having it. It will also highlight some of the typical public liability schemes available, so you will have a great starting point if you do decide it’s the right insurance for you.
Overview of public liability insurance
Public liability insurance will cover you in the event of someone being accidentally injured by you or your business operation. It will also cover you if you damage third party property while on business. In both of these instances, public liability insurance would pay your legal fees and expenses should a claim arise.
As a general rule, if members of the public or customers come to your premises or you go to theirs (including if you work from home), you will need public liability (PL) insurance.
It is important to note, however, that this type of insurance will only cover third party claims and not claims related to employees. For this type of cover, you need to take out an employers’ liability insurance policy.
To recap, public liability insurance protects you in the event of accidental:
• Injury to any person
• Loss of or, damage to property
Setting the Limit
Ultimately, the choice is yours as to how much public liability insurance cover you take out. This decision should be made in line with the type of business you run.
A lower limit of £1 million may be appropriate for a ‘one-man-band’ builder or a small office or social club. However, with the increased risks involved, this amount would probably be unsuitable for medium to large businesses. These might like to opt for £5 million of cover to ensure full peace of mind when carrying out their business operations.
If you are unsure about the amount of cover your business requires, you could contact your broker or insurer and ask for a guideline amount for your occupation. The level of cover will still remain your choice, but you may be able to gain an insight of how others have calculated their risk.
Common policy exclusions
There are standard exclusions with most insurance policies that you buy. These are a few of the common policy exclusions for public liability insurance:
• Property belonging to the insured
• Defective workmanship
• Damage as a result of any advice, design or specification given unless part of an ‘overall contract’
• Deliberate acts
These exclusions may vary from insurer to insurer. If you are unsure whether a public liability insurance policy covers you for a particular aspect of your business, you should always check this information with your insurer or broker before buying.
Claim Examples
Claim cause: bodily injury
Bodily injury claims can vary greatly and can sometimes materialise when you least expect it. The Personal Injury Post, an online injury resource, recently published a story about a lady who slipped on two grapes in a bath supermarket in 2005. She was later awarded £30,000 compensation after the accident left her needing a shoulder joint replacement operation.
Claim cause: burns
On their website, Osbornes Injury Lawyers describe a young woman who suffered temporary burns from wax treatment in beauty salon. It went to trial which eventually ruled in her favour. The claim was settled for £3,000.
Claim cause: physical and psychological damage
Osbornes Injury Lawyers also describe an accident that affected an elderly lady, but in another type of way. On visiting a restaurant, a broken handrail caused her to fall. Physical and psychological injuries accelerated the need for residential care and the case was settled after litigation. She received a total of £100,000 in compensation.
Buy It!
Given the seriousness of some of the incidents described in this guide, it is not surprising that public liability insurance is considered to be essential cover by many UK businesses. Even when every practical measure has been taken, accidents can still happen and some businesses need to bear this in mind, especially if they deal closely with the public.
If you are interested in obtaining a public liability policy, you can get a quick public liability insurance quote online by visiting our public liability insurance page. Alternatively, if you would like to discuss your business’ insurance requirements in more detail, please don’t hesitate to call us on 08081 68 68 68.
If you have found this guide helpful, you may also like to view our employers’ liability insurance guide.
