A simples guide

Public liability for small businesses

When you own and run your own small business, part of your job as boss is to make sure you’re prepared for the future as much as you can be. That means planning for rainy days and all eventualities, but there’s one area that you might not be able to foresee and that’s accidents. Accidents by their very nature are unpredictable and unexpected but you can still protect yourself by ensuring you’ve got appropriate public liability cover.


What exactly is public liability insurance?

Public liability insurance will cover you if a member of the public makes a claim against your business. Most policies will cover you for claims relating to injury or damage done to a third party or their property. You should be covered for any associated legal fees, the cost of repairing the damage, any particular medical treatment (if the NHS decides to claim expenses off you) plus any other reasonable costs. Don’t underestimate how much this can all add up to either.


Do I actually need public liability insurance?

Unless you own a horse riding establishment, you don’t legally need public liability cover. But the question you should ask yourself is – can you afford not to have it? We’ve all heard the stories about ‘claim culture’ and the nightmare scenario of people claiming for damages and it’s all too easy to dismiss those tall tales.

But genuine accidents can and do happen. All it takes is a wet floor on a rainy day and for someone to slip and break their wrist for a claim to be made. As the owner of the business where the accident occurred, you’re liable to meet that claim for injury.

It’s not just for small businesses with a shopfront

The clue’s in the name – public liability is appropriate if you have any dealings with the public and not just if your premises is a shop. You could be an electrician, plumber or builder – anything where your business comes into contact with the general public.

Say you were a painter and decorator and you’re in a client’s house, your paint tin or wallpaper paste ends up spilled over the carpets – you’d be deemed liable for sorting it out. That could mean the cost of replacement carpets, the labour to fit them and compensation for the inconvenience. If you had public liability insurance in place, it could save you a lot of hassle and a small fortune.

Public liability should also cover you if you take your business on the road – such as if you host events or activities in connection to your work. And if you want to set up a market stall or become a regular at a craft fair then you may well need it before you’re allowed a pitch.

As a small business, chances are your cash flow is precious and there’s probably very little wiggle room in your margins for dealing with damages claims. Whether or not you have public liability cover in place could mean the difference between staying open or shutting up shop – for good.

What should I look for in small business liability insurance?

When you’re considering any sort of business insurance, you’ll need to be as honest as possible – premiums are calculated on a number of factors such as the nature of your business, whether you’re working alone or with a partner and also your claims history. Any little white lies or failure to declare something could mean that your policy is invalidated.

Some points to look for when choosing a policy include:

  • Level of cover – some providers have a starting point of £1 million with the option of increasing that if your business needs it.
  • Legal costs and cost of compensation – should also be included, the amount these go up to will differ by provider.
  • Compensation for loss of work – handy if you end up losing days’ worth of work because you have to go to court.

Searching for public liability insurance

Finding the right kind of insurance for your business doesn’t have to be hard, at comparethemarket.com, we’re on hand to provide you with choice and advice so that you can protect your livelihood. You can search online or to have a chat about your options in more detail, you can request a call back – we’re here to help your business stay strong.

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