Public Liability Insurance: What is it? Do you need it?


Under the law, every small business and property owner has a duty of care to the general public and can be held responsible for any injuries that a person sustains on their property or as a result of their business activities.

And this is why it is so important to have Public Liability Insurance. Whatever business you’re in, if you or your employees, are interacting with clients and suppliers on your premises, or if you have premises which are open to the general public, then you need public liability insurance.

Public liability insurance will cover you for:

  • The risk of causing damage to another person’s property
  • The risk of causing injury or death to another person

For a public liability claim to be successful, the injured person needs to prove that your business was at fault, due to negligence. And this can be an expensive process involving lawyers and various specialist assessors as well as court costs. And then on top of that, if you lose against the claimant, your business would also be responsible for paying whatever compensation has been deemed fair to the injured person. Potentially also the claimant’s court costs too.

Financial impact

The financial impact is not always easy to predict, and it can be devastating for small business.

Of course, some businesses are at a higher risk than others simply because of the nature of the business – a construction site will be considered higher risk than a small digital marketing agency for example, but it’s important to understand what risk you face, and to ensure that you have adequate insurance in case you ever need to use it.

While some trades have mandatory public liability requirements, particularly those that must operate under a state government issued licence such as an electrical or plumbing contractor and some businesses may have also mandatory requirements set by their industry association or in a tenancy agreement with their landlord for example, public liability insurance is not compulsory.

But it is the wise business owner who gets properly protected, because accidents can and do happen.

If we can help you understand managing risks, talk to us.