What is

PUBLIC LIABILITY
INSURANCE

Public liability insurance is one of the most common insurances bought by companies, big or small. The concept of public liability may be confusing at first, but once you understand it, you will see that it is a must for running your business in the public sphere.

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What does public liability insurance cover?

Public liability insurance is meant to cover legal costs and compensation payments if your business is held responsible for injury or property damage to a third party – a client, contractor or another member of the public. The coverage protects the staff while on duty outside of the office and extends to cover landlord property.

A potential claim may arise if your consultant accidentally spills coffee on a client’s computer/equipment while visiting their office. Or, it could arise due to a customer slipping on the floor when visiting your property, in the absence of a warning sign for a slippery/wet floor.

In both cases, your business could potentially be sued, and the policy will cover the legal expenses as well as the compensation required within the limits of the policy.

What is the maximum cover I should have?

Unless the landlord or your clients mention any specific sum in the contract signed with them, you are free to choose the sum insured. However, we usually insure businesses in the range of USD 1M to USD 10M depending on the size of the business and the nature of risks.

How much will it cost?

The premium for public liability insurance will take into account many factors, including nature and size of your business, its perceived risk, your business turnover and the amount of insurance cover your business needs. The rate is however not a percentage of your turnover but a flat rate based on the number of locations insured.

What is the difference between public liability and commercial general liability?

Public liability and commercial general liability mean the same. You will probably be requested to buy a commercial general liability (CGL) which is basically a combination of public liability and product liability.

Is public liability insurance compulsory?

Though public liability is not compulsory, it is usually recommended for the landlord in your rental contract as it will protect them from damages caused by you to their property. Also, if your staff is required to regularly visit clients in their workplace, it is quite likely that your contract with them will require you to buy public liability insurance. Any businesses interacting with the general public should definitely buy this policy (shops, restaurants, tradesmen, etc.).