Why it is important for business?
Public and Product Liability Insurance covers your business from claims made by any third party for compensation of an injury or damage to their property as a result of your business activities. So to ensure your business is adequately covered to cover the costs of a claim where you are found negligent or to defend such a claim, you should consider the following examples:
- A customer trips or falls in your showroom or retail store
- One of your employees reverses into a customer’s fence
- A customer’s car is damaged during a regular service at your auto shop
- A customer becomes ill after eating at your cafe
- An angle grinder manufactured by your company injures a customer in their home
- An electrician falls through a customer’s ceiling
- A crane falls onto a truck and injures the driver
- A customer trips over a step as they leave your home-based office
In essence, a public liability claim can be made against a business if a customer or member of the public is injured in an unsafe environment, their property was damaged or a defective product leads to injury or damage. The list of potential claims against a company that interacts with the public is endless and can lead to significant financial and reputational losses.
Who needs Public Liability Insurance?
Consultants who work from home, contractors and tradespeople, businesses that have physical premises, and any company that interacts with customers or members of the public needs Public Liability Insurance. Whether you are self-employed or have 1000 employees, Public Liability Insurance covers you against injury, death, or damage to property or possessions due to negligence caused by your business. Whilst Public Liability Insurance is not compulsory in Australia, obtaining a license as a builder, plumber, or electrician, for example, is often conditional on having this type of insurance. Also, if you need to work at a construction site or other place of business, Public Liability Insurance can be a requirement before you are allowed to enter the workplace.
What does Public Liability Insurance cover?
Whilst each policy will differ between providers, generally, this type of policy will cover your legal costs for defending or settling a claim, any settlement or compensation made by your business to the claimant, and any costs awarded to the claimant by the courts.
What does it not cover?
Public Liability Insurance does not cover injuries or loss to your employees, this needs to be covered under Workers’ Compensation. So if one of your employees falls through a ceiling in a customer's home, any injuries they receive will be covered under Workers’ Compensation, not your Public Liability Insurance, but the damage to the customer’s home will be covered under your Public Liability Insurance. Punitive damages are also not covered, as well as criminal activities. It’s important to note that your Public Liability Insurance can be tailored to suit your specific needs, so it pays to talk to an insurance expert.
To decide whether Public Liability Insurance is suitable for your business call me on 0417097642 or via my Contact Me page.