Public Liability Insurance FAQ

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What is public liability insurance?

Public Liability Insurance

Is anyone liable?

Public liability insurance provides cover against claims made by members of the public who have suffered injury or damage to property in connection with the business. If a member of the public is injured on your property you may be held responsible. For example, a customer might slip on a wet shop floor.

It is designed to pay compensation which can include loss of earnings, future loss of earnings and damages awarded to the claimant in addition to your legal cost in defending the claim and the claimants’ legal costs that you incur if you are found to be at fault.

Public liability claims can be made as a result of an accident at your business premises or outside of this space – perhaps when you are on a sales visit or working on a construction site, for instance. Some customers or clients may also require you to present proof of public liability insurance before they work with you. This is quite common particularly when working with local authorities, so you need to bear this in mind.

What is public liability?

Public liability is a legal liability to pay any damages awarded to members of the public for injury, illness, disease, or damage to their property, sustained as a result of negligence during your business activity.

When would I need public liability insurance?

If members of the public or customers come to your premises or you go to theirs, you should think about taking out PLI.

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Why do I need to have public liability insurance?

It’s essential to have sufficient public liability insurance cover to protect yourself and your business against claims of negligence resulting in injury to a member of public or damage to property. Failure to do so could result in a legal claim being brought against you and your business for damages in the event of a claim.

Is PLI compulsory?

While employers’ liability insurance is compulsory, public liability insurance is generally voluntary. However some businesses, eg horse riding establishments, are required by law to have public liability cover. You will also find that many of your customers or potential customers require proof of adequate insurance before they will allow you to work for them.

What is employers’ liability insurance?

If you employ anyone you are required by law to take out employers’ liability cover. It is similar to public liability insurance, but relates specifically to employees. Recent examples have included an employee injured when a cupboard fell off the wall; and an employee injured following a fall from a ladder.

What is the difference between liability and personal accident insurance?

Liability insurance covers you for damages and costs that may be awarded against you in a Court of Law, when you have been found to be at fault. The personal accident section provides an agreed amount of compensation in the event of an injury, such as loss of a limb or loss of sight, suffered by an out of school club official or club child in an accident, irrespective of who may have been at fault.

What occupations are covered by a public liability insurance policy?

Many types of occupation are included for public liability insurance such as: contractors, builders, electricians, plumbing, carpenters, scaffolders, painters and decorators, bricklayers, demolition, ground workers, gas fitters, glaziers, plasterers, joiners, roofers and bathroom installers.

What types of insurance are available online?

Business insurance
Public liability insurance
Small business insurance
Home workers insurance
Self employed insurance
Business insurance for professionals
Home business insurance
Landlord insurance
Professional indemnity insurance
Employers liability insurance
Product liability insurance
Office insurance
Shop insurance
Pub insurance

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Do I need public liability insurance if I work from home?

If you work from home, and customers or members of the public visit you there, you may also want to think about taking out PLI.

What is the cost of public liability insurance?

Difficult to give a general answer. The cost and conditions of cover vary depending on many factors. Each person’s circumstances are different so you need to get insurance suited for your needs.

What is the difference between public liability and professional indemnity?

Public liability insurance provides cover for accidental bodily injury or physical damage to property of a third party, in the event of an incident occurring for which you are at fault. Professional indemnity insurance is concerned with errors or omissions you or your staff may inadvertently make in the course of your duties.

Do I really need public liability insurance?

If you do not have PLI you are be liable to pay the full amount of compensation required to settle any claim. Public liability claims can amount to huge sums of money.

Which establishments most in need of public liability insurance?

The types of businesses that benefit most from public liability insurance are:

Retail stores
Bars
Nightclubs
Theaters
Sports facilities
Hotels

Some industries are very expensive for insurance companies to insure. These types of companies may be denied a policy because they are considered such high risk, or they may just be charged extremely high rates.

Without public liability insurance, a business has the potential to be closed if there is an accident. Those who refuse to purchase these policies will be financially responsible for everything, and they may not be able to afford it.

How is the cost of my public liability insurance calculated?

Public liability insurers premiums depend on the type of business you run, your turnover and the number of employees you have. For public liability insurance the exposure risk is also based on factors such as whether you work away from your premises.

What level of public liability cover should I buy?

The amount of cover that your business will require in this area largely depends on the level of risk that it undertakes on a daily basis. You will probably find that there are accepted minimum standards for the particular industry you operate in, and there may be requirements specified by your clients in this area. Before making a decision on how much cover to buy, you should always check out both of the above.

In particular, if working on a government or local authority contract you will usually find that they stipulate a minimum level of cover in this area and it’s common for this to be between £5 -£10million.

How do I get a public liability insurance policy?

Just click on one of the ‘Get a quote online buttons’ and fill in the form.

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