What is Public Liability Insurance?

Public liability insurance for the moment is not a compulsory level of coverage for businesses though there is currently a great debate raging regarding whether it should be mandatory or not. However, many businesses they are finding that customers are taking their business elsewhere if they do not have this level of coverage.

So what exactly is public liability insurance? To put it very simply, public liability insurance offers businesses protection against their liability for causing accidental bodily injury to third persons, and also against damage to a third party’s property while you undertake your business activities.

Say you are a plumber, and you are called in to fix a leak. If you accidentally knock something over and damage it, you are covered. Or if you a builder and the client comes on to the construction site and something falls on them, you are covered.

Public liability insurance covers businesses if the third party is on the business premises or if you are on the third party’s property, it is especially important to take out public liability insurance if you work on customer’s sites. If you do all your business by phone or email – for example you are an accountant or IT consultant – it is less important for you to take out public liability insurance as you won’t enter your client’s homes and they are less likely to come to your office.

It is important to note that public liability insurance does not cover any damages awarded as a result of your negligence, so if this is the case you would have to pay the damages and both sets of legal fees. However, if it is not found to be a result of your negligence then the public liability insurance policy would cover the cost of the damages, your legal fees and the claimant’s legal fees.

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