What is public liability insurance?

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    Chris Godfrey

    Page written by Chris Godfrey. Last reviewed on May 26, 2024. Next review due April 6, 2025.

    Public liability insurance is a type of business insurance that protects your organisation if someone is injured, or their property is damaged because of the services that you or your company provides. This type of cover, also known as PL or liability insurance, is designed to protect your business against third party claims for injuries or property damage from a customer or client, passer-by, or a visitor to your business premises – whether you’re at fault or not.

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      When would I need public liability insurance?

      Public liability insurance is a good idea for almost all businesses, (including sole traders and the self-employed), and especially those that interact with the general public and work for local councils or central government. Some personal injury or property damage claims can run into the hundreds of thousands of pounds.

      If your business operations put your organisation in a position where a customer, client, supplier or a passing member of the public (even in or on a vehicle) could suffer injury or damage to personal property, then you need PL to protect your business against the potential of crippling financial claims. Additionally, some customers may demand that you have public liability insurance before contracting with your company.

      What type of businesses need public liability insurance?

      Businesses that typically require PL to operate safely include:

      • Builders and landscapers 
      • Electricians
      • Plumbers
      • Cleaners
      • Carers
      • Telecommunications and TV installers
      • Restaurants and hotels

      And any type of business that comes into contact with the general public or provides services that have the potential to cause significant personal injury or damage to property in the event of an accident.

      Is public liability insurance a legal requirement?

      No. public liability insurance is not a legal requirement, but the potential losses from not having it can far outweigh any premium savings you may obtain. 

      How much public liability insurance do I need?

      The amount of public liability insurance you need depends on the industry you work in, (is it high risk), and the size of your contracts or sales. In most cases, the bigger your sales are, the higher the potential claims may be. (Keep in mind that a claim for personal injury or property damage will usually be increased by added legal fees and other clerical costs).

      If you work with government departments or local councils, you should consider a policy of up to £5million, although minimum cover levels typically start at around £1million, which is more suitable for small businesses, sole traders, and organisations that have less contact with the public. 

      What does public liability insurance cover?

      Public liability insurance protects your business from financial loss if someone is injured, or their property is damaged because of the work that you or your business provides. 

      What’s covered:

      • Personal compensation – for the injury or death of a third party, including the loss of earnings and future loss of earnings
      • Medical fees – including the cost of calling out an ambulance, treatment and a stay in hospital for the claimant
      • Repairs – including the cost of labour and materials
      • Legal costs – including the cost of defending you against a claim and the claimants’ legal costs if you’re found to be at fault

      What’s not covered:

      • Accidents that affect your employees or their possessions – if you employ anyone, you must have employers’ liability insurance by law. This covers anything that might happen to your employees
      • Accidents that happen to you or damage to your own property – protection for yourself or your business premises is usually covered under a general business insurance policy

      How Swoop can help

      All business involves risk, but that doesn’t mean you have to suffer the consequences if things go wrong. Don’t let an accident become a catastrophe for your business. Contact Swoop today to compare top-quality public liability cover from different providers and to discuss all your insurance needs. 

      Written by

      Chris Godfrey

      Chris is a freelance copywriter and content creator. He has been active in the marketing, advertising, and publishing industries for more than twenty-five years. Writing for Barclays Bank, Metro Bank, Wells Fargo, ABN Amro, Quidco, Legal and General, Inshur Zego, AIG, Met Life, State Farm, Direct Line, insurers and pension funds, his words have appeared online and in print to inform, entertain and explain the complex world of consumer and business finance and insurance.

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