Public liability insurance covers legal costs and compensation if your business injures someone or damages property. It is not mandatory by UK law but serves as protection from costly claims. For example, if a customer trips in your shop and breaks their arm, public liability insurance would cover the costs.
Typical cover starts at €2.6 million. As a self-employed person with employees, employers’ and public liability insurance is necessary to cover employee injury claims. Your insurer takes care of customers’ property replacements, medical costs, and loss of income.
The average UK premium is £119, although some small businesses may pay less. Public liability insurance can offer protection against legal expenses, compensation, medical costs, and loss of income.
The Insurance Essentials for Business Operations
For businesses, public liability insurance is vital if the actions of the company could potentially cause injuries or property damage to customers or the general public. Even with safety precautions in place, accidents like a customer slipping could lead to legal proceedings. This kind of policy typically offers cover ranging from £1-5 million for each claim.
When considering what type of insurance is needed to run a business, apart from public liability insurance, licenses and permits may be required depending on the business structure. For trades like plumbing, having specific liability insurance is highly recommended to cover potential damages.
A business owner’s policy, which often includes liability and property insurance, plus business interruption coverage, can be customized to suit different business needs. General liability insurance is crucial from the onset, especially to handle injury lawsuits and damage to third-party property.
What Does Public Liability Insurance Include?
Key Coverage
Public Liability insurance offers coverage for:
- Legal Expenses: Costs associated with being sued.
- Compensation: If your business is found liable.
- Medical Costs: Injuries or accidents involving the public.
- Loss of Income: Insured parties’ income loss due to injury.
Exclusions
However, there are certain exclusions:
- Building Materials: Damage to the materials you’re working with.
- Tool Theft: Although some policies offer this as an optional extra.
Employers’ and Public Liability Insurance
For self-employed individuals with employees, employers’ and public liability insurance is essential to cover claims relating to employee injuries. These policies cater to replacing clientele property, covering medical costs, and loss of income stemming from such injuries.
Cost-Effective Strategies
To lower insurance costs, businesses should:
- Implement safety measures
- Increase excesses
- Lower policy limits
By managing these elements effectively, enterprises can reduce their insurance premiums while still maintaining adequate coverage.