Do I really need public liability insurance?

If you run your own business you may want to consider the benefits of taking out public liability insurance. It’s not a legal requirement to take out public liability insurance, however, if your business activities involve any interactions with members of the public then it’s a good idea to take out this insurance.

Public liability insurance covers you against any liabilities for injuries or damages which may be caused due to your business activities and cuts risks of your business facing substantial claims for compensation or court proceedings.

When public liability insurance is recommended

Although there is no legal obligation for you to take out public liability insurance it is recommended if your business activities entail any of the following:

• doing any work in public places
• receiving visits to your workplace from members of the public or customers. If you are self-employed then your public liability insurance would cover you in your own home or while out at markets or trade fairs
• visiting or working in other premises, such as client businesses or customers’ homes

Your public liability insurance would cover your business in the event of any accidents which could lead to your business being liable for damages or compensation.

What is covered by public liability insurance?

Your public liability insurance covers your legal liabilities for any claims for injuries or damages to the public which occurred as a result of your business activities. All associated costs are also covered, including:

• legal fees for defending any case
• NHS hospital cost claims
• costs for making any necessary related repairs
• compensations claims made by the injured person

I already have employers’ liability insurance, so I don’t need public liability insurance

Employers’ liability insurance is a legal requirement which covers your legal liabilities to any employees if they should suffer injuries as a result of working for you. Your employers’ liability insurance will not cover you in the event of any claims for injury or damage that are made by members of the public.

How much public liability insurance should I have?

All businesses operate in different ways and engage with members of the public to differing degrees, so public liability insurance is gauged to meet your needs. Some of the factors that will influence the level of public liability insurance you need to take out include:

• the size of your business and the number of employees
• the level of cover you require
• what levels of public engagement your business has
• levels of risk associated with your line of business

Your premiums will be calculated based on the above information and your public liability insurance will cover you in the event of claims for damage or injury from members of the public. Most businesses have some forms of contact with the public, so it is possible that you could find yourself in a situation where you are being pursued for damages caused as a result of your business activities. Taking out public liability insurance means you won’t have to cover the costs of any potential legal proceedings and all claims for compensation or damages will be handled via your insurance provider.

The Main Types of Public Liability Insurance

There are various different types of public liability insurance policies, which include:

Limited Company Public Insurance

Limited company public liability insurance is for people who own limited liability companies, protecting the business from claims, such as accidental damage.

Small Business Public Liability Insurance

If you operate or manage a small business that deals with various clients and suppliers, you will need public liability protection. This extends to businesses that work at clients’ homes, where you may be held liable for any injury or damage caused by working for them.

Landlord Public Liability Insurance

As a landlord, it’s your responsibility to make sure your tenants are safe while living in your properties. If they are injured – perhaps due to uneven flooring or unstable fixtures – they may sue you if they weren’t made aware of these things before moving in. 

Landlord public liability insurance can protect you from anything you could be personally and financially liable for. This cover will also protect anyone visiting the property.

Self-Employed Public Liability Insurance

This concerns people who are sole traders or are self-employed. Though being your own boss brings with it many benefits, it also means you’re responsible for anything that goes wrong. Accidents happen, which unfortunately, can put your livelihood at risk. 

Self employed public liability insurance ensures you’re protected if a customer, supplier or member of the public suffers an injury or has property damage due to you and/or your company. 

Personal Public Liability Insurance For Individuals

Personal liability insurance covers you if you are accused of putting someone’s health or property at risk. For example, a neighbour can claim if they hurt themselves while on your property, because you may not have kept the area safe. 


What is the difference between public liability and third party indemnity?

This is a question we get asked a lot, and it’s a good one. Third party indemnity insurance is there to protect you from professional negligence whereas public liability covers you against loss, injury or damage to the general public. Indemnity is a contractual obligation of one party to compensate the loss of another due to your business or working practices.

For example, if carpet was covering uneven flooring, but a customer walked into your shop and hurt themselves, you would be covered by public liability insurance. However, if you advised a client to install a certain product and it caused them harm, they could make a claim against your indemnity insurance.


What if I need to claim on someone else’s public liability insurance?

If you want to make a public liability claim, you will need to give evidence that the other party is responsible for your damage or injury.

You can do this by:


  • Reporting the accident straight away.


  • Make a note in an accident book if possible.


  • Take names and addresses of witnesses and take photographs of the area where it happened.




If you ever need to make a claim, we’re only ever a phone call away, so please don’t hesitate to get in touch.

Public Liability claim example:

A customer is visiting your premises and she injures herself whilst visiting.
The customer contacts their solicitor to start a claim for compensation against you for injury and loss or earnings. If you do not have Public Liability Insurance, your defense will begin:
• You will receive court notification of the claim the customer is making against you.
• You would need to contact your own solicitor and advise or if you do not have a solicitor find one and obtain an estimate of costs.
• You will need to provide your solicitor with a documentation of events leading to the claim.
• Both solicitors will collect evidence and document.
• You will invoiced direct by your solicitor for costs.
• If the claim is contested by the injured party a court hearing will take place which you will need to prepare for.
• You will need to pay for solicitors, barristers and court fees.
• If you lose, you would then incur further costs for compensation, damages, medical costs and legal fees of both parties.
• If you win you need would need to recover, as much of your legal costs from the claimant – rarely are legal fees recoverable in full.

It makes sense to protect your business, yourself and your customers from the almost inevitable hassle of legal disputes. By having, a solid, tailored Public Liability Insurance policy with The Insurance Octopus will help and give you peace of mind that you are fully protected.
Our team are available Monday to Friday for any questions that you may have relating Public Liability Insurance or any other type of business insurance, so call us today and find out if we can help you and your business.

Insurance Octopus is an independent insurance broker for small businesses. We provide a variety of insurances, including public liability insurance, professional indemnity insurance and tradesman insurance. Contact us to learn more about our services.

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