Why Public Liability Insurance Is Essential

Friday, January 27, 2017, PM | Leave Comment

Insurance is vital for businesses of every size. It protects your business against a range of risks and threats, and can help to guarantee your financial stability in the event of a disaster.

Public liability insurance is one of the most important cover types you might take out.

But what is public liability insurance, and why do you need it?

  • What is public liability insurance?

    Public liability insurance covers you against claims made by clients or members of the public because of personal injury or property damage arising from a mistake you make in the course of your business.

    It can pay for the costs of those claims, along with associated legal expenses.

    For example, if you have premises and a customer slips on a wet floor, injuring themselves, a claim may follow.

    Alternatively, if you’re an IT consultant, you may be working in a client’s office and a worker may trip on a stray cable.

    Public liability insurance should pay out in both these cases.

    The cost of claims of this sort can be enormous, and easily enough to cripple a small business. Public liability insurance helps to make sure that you can cover those costs and get on with your work.

    This is one of the most important ‘core covers’ that small businesses should consider taking out. It’s vital for any business that interacts with customers, clients, or the public.

  • How much does public liability insurance cost?

    The cost of your public liability insurance will depend on a range of factors including the amount for which you need to be insured, the nature of your work, and the excess included in your policy – that is, the size of the first portion of your claim, which you will have to cover.

    You may be able to bring down your premium by increasing the excess, but if you do so, you should make sure that you would have the spare cash available to cover that sum.

    It is also vital that you are not underinsured. When considering the amount for which you would like to be covered, make sure that you err on the side of caution in order that you are insured against all eventualities.

  • What other covers might my business need?

    As well as public liability insurance, there is a range of other cover types that your small business might need.

    These include:

    • Employers’ liability insurance, which, if you employ anyone, is a legal requirement in many countries.

      The penalties for failing to take out employers’ liability insurance when you are required to do so can be severe, so make sure that you are covered.

    • Professional indemnity insurance, which protects you against claims stemming from material loss suffered by a client as a result of a mistake you’ve made.

      For example, if you’re an architect and you make an error in your plans that causes a client a loss, professional indemnity cover could pay out.

    • Stock insurance, which protects your stock against theft, loss, or damage.

    • Personal accident insurance, which can cover loss of income and medical bills in the event that you suffer an accident that prevents you working.

Public liability cover can be purchased as part of a single small business insurance policy from providers like Simply Business. This means that you don’t have to worry about multiple policies with multiple renewal dates and premiums.

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