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What is a Public Liability Insurance?

This is perhaps the most often asked question by business owners. It is especially critical for tradies to know the answer to this since, based on who your insurance is with, there are elements public liability covers that you should be conscious of in times of emergency.

In the event of an unforeseen catastrophe, public liability insurance protects your company. It covers public claims made in connection with your company’s day-to-day operations.

It is essential for almost all organisations to have, and even more so if your business deals with clients and/or the general public. This involves working on your business premises, at a client’s location, or in or on a property owned by someone else.

It can protect you from legal liability if your company causes damage to someone else’s property as a result of a negligent act. Legal and property repair fees can quickly grow and prove financially crushing if you do not have adequate coverage.

Learn more about what public liability insurance covers and whether your business needs it.

How Does Public Liability Insurance Work?

Countless businesses come into contact with the general people and interacting with them is fraught with danger. Even if you post warning signs, a customer could slip and fall on a wet surface, and you could end yourself with a lawsuit on your hands.

If someone sues your firm for a cause covered by your insurance policy, you file a claim with your insurance carrier. Your insurance provider contributes to the cost of your legal fees and pays damages up to the terms and terms of your coverage.

A brief description of the “insuring clause”

The policy’s coverage is fairly extensive. It protects you against unintentional damage or loss to someone else’s property. This includes the loss of use of non-physically property damage. It also protects you against personal injury responsibility (other than staff) that is not insured by Accident Compensation Corporation (ACC).

It includes consequential harm or downstream losses, such as the loss of income to a business such as restaurants that had to shut down due to a power outage caused by someone cutting an underground wire. Or the damage to floors and walls caused by a leak when fixing or installing a skylight.

Some policies additionally cover damage caused by poor workmanship, which is frequently excluded but is an important extra layer of protection for builders and tradies.

The coverage will also pay the expenses of legal defence in connection with the claim.

Typically, public liability claims are:

  • Compensation for third-party injuries or even death
  • In the event of property or goods that have been damaged
  • Legal expenses while you are defending any of these claims
  • Repair or replacement costs
  • Ambulance call out as well as medical assistance and treatment
  • Faulty or inadequate work
  • For firms engaged in trade professions, personal injury or property damage resulting from free advice, services, or training.
  • Legal expenses while you are defending any of these claims

Who needs public liability insurance?

Could you afford to pay the costs of a compensation claim if your company was sued and you did not have insurance? Do prospective customers expect you to have public liability insurance? Could you lose customers if you do not have insurance?

The need for public liability insurance is determined by the location of your business and its specific requirements. It is a more limited policy than other types of business insurance, which implies it is less expensive but provides less coverage. It could be called the most basic insurance most businesses with employees should have. To simply put, if your company comes into touch with members of the public, if you have visitors to your facilities, or if you work on client sites, public liability insurance is a must.

Although liability insurance is not required, most businesses should carry some form of liability insurance. Before accessing a construction site, it is common practise in the trades to have public liability insurance in hand. Depending on the nature of your business, you may require more than the minimum amount of protection, so it is prudent to review your policy with each new project or contract.

If your business has the potential to cause damage, injury, or loss to other people or property, contact our professional team and we will help you understand the best liability coverage for your company’s growth.