Types of Liability Insurance
If you don’t have employees, you don’t need employers‘ liability insurance. Public liability insurance is essential for any company. You could save money by combining both insurances on one policy, but first determine if you need both types of cover.
Public liability insurance is there to protect you if someone is injured or their property is damaged and your business is faced with a compensation claim as a result. It covers you at your business premises and also when you‘re working at client sites or in public.
If you want to sell your wares at craft fairs, you will need to purchase insurance. In fact, fair organisers will often want to see proof of Public liability insurance and product liability insurance.
The Employers’ Liability Act 1969 ensures that you have at least a minimum level of insurance cover against any claims. Employers’ liability insurance will enable you to meet the cost of compensation for your employees’ injuries or illness whether they are caused on or off site.
Choosing the Right Coverage
Public vs General Liability Insurance:
- Public Liability Insurance (PLI) covers injuries suffered by visitors to your business property.
- General Liability Insurance (GLI) is more extensive, covering visitor injuries, employee injuries, and defective-product damages.
Why Buy PLI Insurance?
PLI coverage applies strictly to injuries, accidents and property loss suffered by the public on your business premises. This can include customers, visitors, and delivery personnel. PLI covers less than GLI, so the policies are cheaper.
Professional Liability Insurance:
Professional liability covers risks, such as errors and omissions in the services your business provides. For self-employed individuals, considering public liability insurance is important, even though there’s no blanket requirement.
Comparing Coverages:
The main distinction between the two types of insurance lies in the scope of coverage:
- PLI: Focuses on bodily injury and property damage to third parties during business operations.
- GLI: Offers more comprehensive coverage including bodily injury, property damage, and personal injury from various business operations.
GLI typically includes PLI coverage and is often required by municipalities and states for a business operating license.
Making the Choice:
It’s crucial to understand your company’s specific needs when deciding whether GLI or PLI is more suitable for your business efforts. Consider your business activities, the level of risk, and the coverage options before making a decision.