What is public liability insurance?
We’re all familiar with the phrases “no win, no fee” and “where there’s blame, there’s a claim”. They’ve become part of what many people see as our compensation culture – the need for someone to be at fault whenever there’s an incident.
Unfortunately, negligence is the main trigger for public liability insurance (PL) claims. And, as hard as we try to get things right, stuff gets missed, and accidents happen.
PL’s there for when a third-party claims against your business for personal injury or damage to their property. Your cover will pay your legal fees and, if necessary, cover any compensation.
But, despite the endless cold calls asking if you’ve had an accident, a successful claim needs to prove someone was in the wrong.
To help understand the ins and outs of PL, we’ve looked at some key questions. These include what PL covers, how it protects you and how much cover your business could need.
Do I need public liability insurance to cover my business?
It’s not a legal requirement to have public liability (PL). But, if you see people in the day-to-day running of your business, it’s a good idea.
If people visit your premises – suppliers, couriers, customers, members of the public – and someone has an accident, they can sue. If you see people off-site – at a client’s home or in a supplier’s office, and you accidentally damage their property, they can claim.
You might also need PL if you sell at a craft fair or perform on a stage. The organisers might ask you to have insurance as part of your contract.
How much public liability insurance do I need?
The amount of public liability cover you need depends on the size of your business and what you do.
Think about your day-to-day activities. What’s the worst-case scenario if someone claimed? Say someone fell down some badly lit stairs and broke their back. Or skidded on spilt water and shattered an elbow.
Most insurers offer cover from £1m – £10m, and as a general rule, you can never have too much. Legal defence can cost thousands, and that’s before the compensation bill comes.
Why would a venue ask for a high limit?
If you’re working at a venue – as an events company or a wedding photographer for example – the location might ask you to have a certain level of cover. If so, it’s likely their public liability policy requires anyone working on-site to have the same cover they do.
If you find you need to up your cover limit, you can change it for the duration of the job by contacting your insurer or broker.
How does public liability insurance protect you?
In insurance terms, liability is where you’re legally responsible for something. Public liability (PL) protects your business if there’s an accident and a third party’s injured or their property damaged.
For a successful claim, negligence needs to be proved. Your PL policy pays for legal experts to support your case – even if you’re not at fault. If the claim’s upheld, then PL will also cover any compensation.
It means you can carry on running your business while your insurer takes care of the claim.
What is the difference between employers’ liability and public liability?
Both employers’ liability (EL) and public liability (PL) are there if someone has an accident or is injured and it was your fault. The biggest difference is EL protects your business if a member of staff or volunteer is injured, and PL is for third-party claims.
EL and PL are two separate policies. You can purchase PL as a stand-alone policy, although you usually buy EL as part of a package.
If you employ people, then it’s a legal requirement to have employers’ liability cover. EL can be priced competitively, and most insurers will offer £10 million cover as standard. However, the amount you pay as a premium can vary depending on how many employees you have and how much you pay in wages.
Who needs public liability insurance?
If you see people for work – either at your place, theirs, or somewhere else, public liability is a good thing to have – you never know when you might need it.
You should consider taking out public liability cover if:
- third-party people visit your work premises
- you or your employees see third-party people off-site
- your business organises off-site events or activities
- You sell at craft fairs or pop up events
Are there any hints and tips for comparing public liability cover?
A handy tip when you’re comparing different cover is to check the excess. Public liability (PL) excess is usually £250, but some policies vary, and you need to be prepared in case someone claims.
You can contact your insurer or broker if you have any specific questions about your PL cover.
What are some examples of public liability insurance claims?
It’s important to remember claims for public liability are individual and based on circumstances. Some examples of public liability (PL) claims could include:
- A supplier comes to the office to discuss new product options. During the meeting, the production manager knocks a glass of water over the supplier’s laptop. PL covers the claim for a new laptop as it was past repair.
- A massage therapist visits a client at their home. Before the treatment begins, the therapist knocks over an expensive vase, and it cracks. PL pays to replace the vase.
- A charity organises a coffee morning to raise funds. The urn’s cable is left trailing, and a visitor trips over and breaks their wrist. PL covers legal costs and compensation.
For more info on public liability insurance, a quote in under two minutes and 10% off your premium, visit PolicyBee or call us for a chat on 0345 222 5370.