What Is Public Liability Insurance?
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What is Public Liability Insurance?
Public Liability insurance protects you and your business against the financial implications if you are found liable for loss or damage to other people’s property, or cause illness or injury that is not covered by the Accident Compensation Commission (ACC).
If you are found negligent, the financial repercussions can be devastating. The cost of defending yourself alone could put you out of business, and then there’s the cost of settlements, whether agreed out of court or awarded by the court. With the right Public Liability cover, your insurance company will provide much needed funds to cover your legal costs and any compensation claims, leaving your business free of financial risk. Phew!
Even the most careful businesses run the risk of damaging something during the course of operations. And you don’t want to be left with empty pockets because you tried to save a bit of cash by not purchasing the right amount of Public Liability insurance, or worse, didn’t have any at all.
Most Public Liability policies also extend to Product Liability cover. If you sell, supply or deliver goods, even in the form of repair or service, you may need cover for claims made against you where goods have caused damage or injury. Product Liability insurance covers you if any of these events happen to another business or person by the failure of your product or the product you are selling.
If the risk to your businesses is such that you would go out of business should you experience a public liability claim, then you need to have it. It’s as simple as that.
Did you know?
Commercial landlords may require business owners to show proof of Public Liability insurance before leasing their premises.
Most public liability policies also extend to Product Liability cover. If you sell, supply or deliver goods, even in the form of repair or service, you may need cover for claims made against you where goods have caused damage or injury. Product Liability insurance covers you if any of these events happen to another business or person by the failure of your product or the product you are selling.
Even the most careful businesses run the risk of damaging something during the course of operations. And you don’t want to be left with empty pockets (and some) because you tried to save a bit of cash by not purchasing the right amount of Public Liability insurance, or worse, didn’t have any at all.
If the risk to your businesses is such that you would go out of businesses should you experience a public liability claim, then you need to have it. It’s as simple as that.
And if you are doing business with another business, make sure they have public liability insurance too, so all’s well that ends well should an accident occur from their negligence.
A Public Liability claim could result from
- Accidental damage to a third party’s personal property
- A faulty or defective product that you have manufactured or sold
- Incorrect installation of equipment resulting in damage to property
- Injury, illness or death due to your negligence that is not covered by the ACC
What is covered?
Public liability claims can be expensive. Even a seemingly small claim could cost you thousands of dollars (or more) and potentially devastate your business financially. Your Public Liability policy could help prevent this by covering many of the costs associated with compensating a third party for their loss.
Public Liability insurance typically covers:
- Repair or replacement costs for damaged property
- Personal injury or death compensation to third parties for events not covered by the ACC
- Legal and defence costs
What is not covered?
Public Liability insurance can help create peace of mind for a wide range of professions. However, it’s still advisable to take precautions to ensure your business is operating ethically and professionally.
Typically, Public Liability insurance will not cover:
- Injuries suffered by your employees
- Damage to your own property
- Personal injury compensation when covered by the ACC
Do I really need Public Liability Insurance?
The short answer. Yes. The long answer. Absolutely yes. If you or your employees interact with other people while doing business in any way or form then you need it. For example:
- Consultants/Contractors/ Tradespeople who work from home or visit their clients’ premises
- Businesses that have an office, showroom, shop or any premises where your customers or members of the public visit
- ALL business that have interaction with customers or the general public should have Public Liability insurance
Another thing to keep in mind is who you are working with. If you are doing business with another business, you may want to check that they also have Public Liability insurance. You could be on the hook for expensive compensation should an accident occur from their negligence if they are uninsured. Ensuring that your partners also have a Public Liability policy can help reduce your own risk and avoid unnecessary claims.
Accidents happen, and if they happen in your business premises you could be liable for injuries and property damage that occur. Public Liability helps shield you against these types of claims when they come from third parties, so you can work with more peace of mind.
Top Professions for Public Liability
There are many professions that might benefit from the protections that Public Liability insurance can provide. These include:
- Tradesmen and Contractors – Such as plumbers, electricians, carpenters and woodworkers, general handymen, and painters. These professions often work on sites where property damage and accidents may be more likely to occur.
- Consultants – Including building consultants, management consultants and advertising consultants, amongst others. Consultants of all types work on-site at their client’s place of business or in their own offices. Public Liability can help protect them wherever they may be working.
- Real Estate Agents – As well as Realtors and Mortgage Brokers. Real estate agents frequently hold open homes which can expose them to third-party property damage and injury risks.
- Fitness Professionals – Personal trainers, yoga instructors and others working in the fitness industry. Client injuries due to a trainer or instructor’s negligence could trigger a Public Liability claim.
- Beauty Professionals – Including hairdressers, nail professionals, salon owners and more. These professionals typically see clients in their business premises, but may also visit them in their own homes. Both could present risks that Public Liability insurance can protect against.
Don’t see your profession above? Public Liability insurance may still be important to protecting you and your business.
How much does Public Liability insurance cost?
The amount you will regularly pay for a Public Liability insurance policy (commonly referred to as a premium) will vary. Insurers consider a range of information about your business when calculating the cost of your policy. These factors typically include things such as your occupation, the nature of your business, the business’ size and turnover, and the amount of insurance cover you require.
Often, seeking multiple Public Liability insurance quotes from multiple insurers can give a better idea of how much your small business can expect to pay for a policy. With BizCover, you can quickly compare instant online quotes and get covered in minutes.
To learn more about how Public Liability premiums are calculated, visit our How much does Public Liability insurance cost? page.
Could this happen to your business?
Accidents can happen at any time. Some of our customers can attest to that!!
Here is a real-life claim example:
A landscape gardener who was working at a private residence needed to use a garden power tool to complete the required work. Whilst operating the machine he accidentally lost control of it damaging the side of his client’s house. The landscape gardener’s insurer quickly agreed that he was negligent, as the damage arose out of the operation of the insured’s business activity. They settled the claim with the homeowner’s own insurer within one week. Most importantly however, the homeowner has continued to hire the landscape gardener despite the incident as the matter was able to be settled easily and quickly due to the landscape gardener’s Public Liability cover.
Get more information
Ready to read more about Public Liability insurance? These articles from our blog might be just what you’re looking for!
What does Public Liability Insurance Cover? – A closer look at what is typically covered and not covered by most Public Liability insurance policies and common reasons for claims to be made.
Public Liability Insurance: 5 Tips for choosing the best policy for your business – Suggestions for choosing a Public Liability insurance policy to suit your small business needs.
The difference between public liability and professional indemnity insurance – Public Liability and Professional Indemnity insurance provide different forms of protection to small businesses that are both important.
Insurance Options for Retailers – From Public Liability to Cyber Liability, learn more about the types of cover available to retail shop owners.
How Plumbers Can Protect their Business with Public Liability Insurance – Plumbers may consider Public Liability insurance to help protect their business.
* As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this web page is general only and should not be relied upon as advice.
Rated 4.6/5 for Customer Experience
Just keep doing what you are now.
Seems good so far…hopefully there is no need to lodge a claim, and i guess the proof will be in the pudding at that time. Cheers.
Engineering Consulting Service
Just keep doing what you are now.
Easy simple and safe cheers guys
Panel Beating – Motor Body