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Public liability insurance protects businesses if they're sued. It is a type of business insurance that covers your business in the event of a third-party claim.
Your business could face legal action as a consequence of its activities. That might be causing injury, illness or death to the public, or causing damage to property. And it can cost a lot to put right.
It's designed to cover the cost of any disputes, compensation pay-outs you’re ordered to pay and any legal fees you end up owing.
It's not a legal requirement, but it does offer essential peace of mind.
If your business interacts with the public - whether it's in the street, an office, or a school then public liability insurance is worth considering.
And ‘the public’ doesn’t just mean passers by. It includes:
Customers
Suppliers
Couriers
Anyone who isn’t an employee
Finding the right insurance policy can be time consuming. Running a business and juggling the day to day is time consuming enough.
We can help you find a public liability policy that suits your business. Whether you’re a sole trader, start up or at the top end of a medium-sized business, you deserve peace of mind.
Find a quote that covers your business quickly and simply. That way, you can focus on your business without the stress and worry.
Public liability insurance isn’t a legal requirement. But you may still need it in order to operate.
If your business is in any way liable for injury or damage caused to any third-party, you could face significantly large bills. It's worth asking if your business could afford that. Some trade bodies and industry regulators insist their members have it in place. If yours does, you'll need cover in order to trade. Trade bodies that insist on it include, among others:
Not having it can cause significant reputational damage in the event something goes wrong. If a member of the public is injured or worse and you don't have cover, it can have serious consequences.
There are other scenarios in which you may need cover too. If you work on a contract basis, your clients might insist you have it. Without it, you could miss out. If you work for local councils as a contractor, they'll often insist you have it in place too. As a quick guide, you may need it if:
Your business works on a contract basis
You work with the council or another public body
Your clients want you to have it, as you could lose out if not
Public liability insurance can cover a range of roles and activities. Here are some examples of what it could cover. Bear in mind that these are only examples. You should always check your policy documents to see exactly what your insurance covers you for.
Gardeners could be liable if a client or member of the public trips over a hole that's been dug
Shopkeepers could be held liable for customers injuring themselves in their shops
Builders could injure clients or damage their property while on the job
Online retailers could sell a product that injures a customer
Hairdressers could cause harm to clients with things like hair dye they could react to
A range of factors go into what you pay for your public liability insurance. These include:
The size of your business, as the more people you employ, the higher the risk of an accident
The type of business you have, as some are more likely to cause harm or damage to the public or their property than others
How much cover you take out, as the higher your cover amount the more you pay. Here at confused.com we compare quotes for £1m to £10m of cover.
How often you interact with the public, as dealing with customers day-in-day-out puts you at higher risk than a rarely public-facing business.
When you apply for a quote, tell the insurer as much as you can about what your business does.
Set out how often you interact with the public, and in what capacity.
Insurance applications aren't designed to catch you out, they're designed to ensure you get the cover you need. So be sure to accurately represent your business and its activities.
The quotes you'll get from us are provided by Simply Business, one of the UK’s best known business insurance providers.
They’ve helped more than 3 million businesses since 2005 find the right cover at the right price. This includes everyone from sole traders to large, multi-site operations.
They’re regulated and authorised by the Financial Conduct Authority, too. This means that everything they do is out in the open. Just like every other partner we work with, you can rest assured you’re in safe hands with Simply Business.
Get a quote today and find the cover you need in minutes.
Public liability insurance is designed to cover a range of potential claims. To illustrate how the policy could work in practice, here are a couple of representative examples:
A plumber is hired to fix a leaking pipe in a client's home. During the repair, the plumber accidentally damages a section of pipe near the client's kitchen floor, causing significant water damage. Fortunately, the plumber has public liability insurance which covers the cost of the repairs and any associated damages.
A bar owner is busy serving in their packed venue. During the evening, a customer slips on a spilled drink and breaks their wrist. The customer decides to sue the bar, claiming medical expenses and lost wages. The bar owner has public liability insurance which covers medical bills and compensation costs.
This is a legal requirement for most businesses with employees. It works in a similar way to public liability insurance, but is designed to cover your business against any claims made by employees. This could be for physical harm they suffer on the job, or illness they develop as a result of their work. As with public liability insurance, it can help cover the cost of any compensation you’re ordered to pay and any legal fees you’re liable for.
This helps protect businesses against claims of financial or reputational damage. This could be due to advice you give that leads to a client losing money, or it could be for things that damage your client's reputation. This might be something like leaking sensitive documents that are picked up by the press. It’s designed to help you cover the cost of compensation payments and legal fees your business may be found liable for.
It depends - while public liability insurance isn't a legal requirement, some clients may insist on you having it. So without it, you might find you lose contracts or work.
Some trade associations will also insist you have cover in order to register with them too.
The main thing to bear in mind is the costs your business will face in the event of a claim. The bills due for not having insurance could be enough to prevent your business from being able to continue trading.
The amount of cover you need depends on your personal circumstances, and the details of any contracts you’re bound by.
Here at Confused.com, we compare policies from £1m to £10m of cover.
Depending on your business, you may find £1m isn’t quite enough protection.
To get the right amount, think about:
How often you interact with the public or their property. If there is a greater chance for something to go wrong, it might be worth considering a higher level of cover.
How likely you are to cause them or their property harm. Riskier businesses involving things like heavy machinery may do well to have more cover in place than less risky ones.
How many employees you have, as the more people your business employs, the higher the risk of something going wrong. The more employees you have, the more cover you’re likely to need.
While it isn’t a legal requirement to have it in place, public liability insurance can benefit self-employed traders as much as owners of bigger businesses.
If your business harms a member of the public or damages their property, it could be held liable for damages, regardless of its size. Without public liability cover in place, as a self-employed trader, liability for those damages falls on you.
So, while self-employed traders don’t ‘need’ it, knowing your business is protected can often justify the cost of having public liability insurance in place.
Public liability insurance is not required by law. But having the right cover in place in the event of a claim can ensure your business is able to continue trading.
Yes, most business insurance policies are tax deductible. That means you can deduct the cost of the premiums each year when you complete your annual tax return.
Page last reviewed: 11/09/2024
Reviewed by: Alex Ryde
Confused.com Business Insurance is provided by Simply Business. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London EC2V 7NG. Our service is free and compares a range of trusted household names. Confused.com is an intermediary and receives commission from Xbridge Limited which is based on a percentage of the total annual premium if you decide to buy through our website. We pride ourselves on impartiality and independence – therefore we don't promote any one insurance provider over another.
