With the help of public liability insurance, you can protect yourself and your company from lawsuits brought by clients, suppliers, or members of the general public who have been hurt or whose property has been damaged as a consequence of your careless business practises.
Small company owners are legally required to take reasonable precautions for the security of their customers, suppliers, the public, and their own property.
The majority of public liability plans also provide coverage for product liability. You may require insurance if you sell, supply, or distribute items, even in the form of repair or service, in the event that negligence claims are made against you and your product results in injury, death, or property damage.
Even the most cautious companies run the danger of harming something or hurting someone while conducting business.
If your small firm were the target of a public liability lawsuit, there’s a good chance that the financial burden of settling the claim and related legal expenditures (including defence costs) may force you out of business. To provide your company with the financial security it needs, you should think about purchasing public liability insurance.
Why Do I Need Public Liability Insurance?
Before we go any further, please note that the terms, restrictions, and exclusions mentioned in the public liability insurance policy wording will apply to the coverage, just like they would for any insurance. It is not advisable to rely on the general information on this website as guidance.
Generally speaking, what is covered by public liability insurance?
It is crucial to confirm your coverage details, as with most insurance products. When in doubt, see the Product Disclosure Statement (PDS) or speak with your insurer.
There is always a danger that a claim might materialise if your organisation regularly interacts with customers. Accidents may occur in the blink of an eye, whether it’s a customer inadvertently stumbling over a box of merchandise in a store or a beauty expert applying a product that causes their client to experience an allergic reaction. No matter how inadvertent, a claim’s effects can have a significant negative effect on your organisation, which is a worry you can do without.
Public liability insurance covers incidents like spilling meals on your clients’ clothing or ruining their phones or mobile devices. It also includes accidents, such as accidentally injuring their personal belongings. In the event that physical work is being done on a client’s property and things don’t go as planned, such as unintentionally bursting a pipe and causing damage, it may also offer protection for occupations like tradespeople.
Public liability insurance provides coverage for any potential legal costs associated with your claim, which can quickly mount, particularly if your claim is ongoing for a long time.
Many public liability insurance plans also cover product liability.
What is commonly excluded from public liability insurance?
- You or your workers suffering personal injury
- Personal property damage
- Costs of correcting poor craftsmanship
- Professional malpractice or illegal action
- Liability under a contract
- Situations that occur before or after the policy period
- Advertising involving asbestos
- Pollution
- Recklessness or willful negligence
Should I get public liability insurance?
A common form of coverage that many different kinds of businesses could need is public liability insurance. Public liability insurance gives you peace of mind and safeguards the funds and good name that you have worked so hard to build up for your company.
Some topics to think about are as follows:
- Could your company pay for the associated legal costs as well as any award of compensation in the event that a claim or claims were made? The last thing you want to do is risk your financial security by settling claim-related debt payments with your own money.
- It could also be legally necessary for some types of enterprises to have public liability insurance in place before beginning work. Make sure you have enough protection in place because there may be requirements for a minimum amount of cover.
- Putting public liability insurance in place may also be a condition of your rental agreement with your landlord if you are renting a space for your business.
What may give rise to a lawsuit for public liability?
Running your own business involves a great deal of planning and hard work; the last thing you want to worry about is the possibility of a Public Liability lawsuit. These are some scenarios under which a Public Liability claim could be made.
- As a result of your careless business practises, other persons may be hurt or killed.
- Because of your careless business practises, there has been property damage to a third party.
- Due to your carelessness, there was a direct financial loss.
- Equipment was not installed properly, resulting in property damage.
There is always a chance that a claim might materialise if your firm engages in any kind of interaction with customers, clients, or suppliers. Let’s look at some examples of claim occurrences that are peculiar to the industry.
- Tradespeople – When performing work, tradespeople run the risk of damaging property, such as unintentionally spilling paint on a carpet. This is where coverage for the repair of subpar workmanship might be useful.
- Slips, trips, and falls are frequent dangers for businesses in the retail and hospitality sectors because of their close relationships with clients and suppliers. When offering culinary services, there is also a chance of things like food poisoning claims to think about, which your Public Liability policy’s Product Liability clause may cover you against.
Professionals – There is a range of client interactions available to numerous professionals. Perhaps you’ve set up a home office where clients can come see you, or perhaps you go out and meet them. Public liability should still be taken into account in any case, particularly ifthere is a risk a customer could tumble and hurt themself while on your premises or if you were to unintentionally damage their personal belongings.