Why do I need Public Liability insurance?

Public Liability insurance covers legal fees and compensation costs if a customer, member of the public, or a supplier claims against you for injury or damage to their property as a result of your alleged negligent business activity. Having Public Liability insurance gives you peace of mind against potentially stressful, time-consuming and costly legal claims.

Public Liability insurance can help to cover your business against the financial impact of:

• Personal injury
  Compensation costs to a customer, supplier, or member of the public who is injured as a result of your business activities (when not covered by ACC).
• Damage to Property
  Repair and replacements costs to a property accidentality damaged as a result of your business activity.
• Product Liability
  Covers compensation costs to a customer, supplier, or member of the public who is injured (when not covered by ACC), or suffers property damage, as a result of products you manufacture, supply, or use in the course of providing your services.
• Damage to third-party goods
  Compensation for goods owned by a third party, which have become damaged as a result of your business activity.
• Punitive and exemplary damages
  Cover for court-awarded exemplary damages relating to personal injury (not fines or penalties from regulators).
• Legal & Defence Costs
  The cost of legal and defence expenses associated with a claim made against your business.

Even though it’s not a legal requirement under New Zealand law, customers or other businesses who interact with your business may require you to hold Public Liability insurance in order to complete work for them, the level of cover required will vary between contracts.

All businesses and sole traders can be exposed to risks. Ensure your insurance policies are up to date and provide adequate coverage based on the unique needs of your industry and business activity. Ensure you are capable of handling a Public Liability claim, regardless of whether it is true, with Public Liability Insurance. Let the insurers and lawyers take care of the claim so you can get back to what you do best – running your business.

Public Liability insurance legal requirements

Generally speaking, Public Liability Insurance is not a legal requirement in New Zealand for most businesses. But no matter how careful you may be, if your business interacts with clients, suppliers or even members of the public there is the potential for a claim to occur, which could cost your business thousands of dollars in legal fees and compensation.

Consider getting cover if one or more of the following applies to your business:

• You have customers, suppliers or members of the public who visit your business premises, e.g. diners who visit your restaurant, or clients who visit your office, whether in a commercial building or home-based office
• Working at your client’s site, e.g. a tradesperson carrying out repairs or work in other people’s homes

 Public Liability Insurance for home-based business 

Running your business from home can bring a whole host of benefits like flexible working hours, and no commute, but along with the benefits there are also potential risks for things to go wrong.

If your business has any interaction with clients, suppliers or any other third-party, or you sell any form of products, Public Liability insurance is a small price to pay for big peace of mind.

Going without Public Liability insurance

If you don’t have Public Liability insurance, you may be exposed to different types of risks that could leave your business drowning in legal fees and compensation costs. Could your small business survive the financial cost and reputation damage from a Public Liability claim?

Running your own small business is no easy task. Don’t let your hard work go to waste! Assess your insurance needs and make sure you have adequate coverage for your Public Liability risks.

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