Public Liability Insurance Explained

Public liability insurance offers valuable protection against costly compensation claims and legal costs

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Ensure your business is protected from legal liabilities arising from your duty of care to provide a safe environment.
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Compare public liability insurance cost with a range of quotes provided from the wholesale insurance market.
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Engage with a specialist public liability insurance broker to ensure your business is protected from a range of liabilities.

Public Liability Insurance UK Explained

Compare business insurance for compensation claims by persons other than your employees

Companies have a duty of care to maintain a safe environment for members of the public. Public liability insurance offers financial protection should an accident occur which causes injury or property damage. Below we seek to provide some background and explain how public liability can protect your business.

Public Liability Insurance FAQs

  1. What is public liability insurance?
  2. Who needs public liability insurance?
  3. Who does public liability insurance cover?
  4. Can you provide public liability claim scenarios?
  5. What duty of care do we owe the public?
  6. What is the cost of personal injury compensation?
  7. How much public liability insurance do we require?
  8. What is the Health and Safety Executive?
  9. Can you offer some guidance on risk assessments?
  10. Are public liability claims required to be accidental?
  11. Can you provide cover away from your premises?
  12. Do we require a public liability insurance certificate?
  13. How to compare public liability insurance cost?


What is public liability insurance?

Public liability insurance (otherwise known as PL insurance) will protect against claims arising from injury or property damage of persons other than your employees in the course of your business.

The business insurance will pay legal costs incurred in defending allegations and compensatory damages arising from any judgment, award or settlement.

 

Public liability insurance meaning

Public liability insurance definitions can vary, therfore it is worth considering the terms and features to consider what cover best meets your needs. 

Compare public liability insurance quotes with get indemnity to achieve cost savings on your insurance renewal. Complete our online application and receive quotes in typically less than 48 hours from a range of wholesale insurers.


Who needs public liability insurance?

If your business interacts with members of the public (including any customers, suppliers, contractors) you have a duty of care to maintain a safe environment.

It is not a legal requirement to purchase public liability insurance, unlike employers liability insurance. However, most companies purchase because it offers cost-effective protection against potential liabilities should an accident occur.

All businesses, whether they operate from offices, showrooms, warehouses or construction sites, should consider public liability.

The no win, no fee system makes legal advice more accessible with no upfront costs for the claimant. In addition, the public is generally more aware of their rights and will tend to pursue compensation should an accident occur.


Who does public liability insurance cover?

Public liability insurance will cover claims from any person, excluding your employees, with whom you interact as part of your business. Including, but not limited to:

>  Customers
>  Suppliers
>  Contractors
>  Other Third Persons

Purchasing public liability insurance means your organisation is protected from having to make signifiant compensation payments as a result of injury or property damage.


Can you provide public liability claim scenarios?

Public liability insurance claims usually occur when someone is injured, or property is damaged in a public place because those responsible have failed to ensure its safety.

Below are common public liability claim scenarios, with slips, trips and falls the most frequent:

 
     

Slips, trips and falls

Exposure to hazardous chemicals

Falling objects

Inhalation injuries

Burns or scalds

Dangerous pathways

Glass injuries

Door injuries

Lift / escalator accidents

Whiplash injuries

Hazard objects

Crashes and collisions

 

What duty of care do we owe the public?

All companies have a duty of care to maintain a safe environment for members of the public. However, your duty of care can vary, depending on how the persons have been invited.

  • Invitees are members of the public (including customers, suppliers and contractors) who interact with your business at your invitation. Your duty of care is to take all reasonable steps to ensure a safe environment.
  • Licensees are members of the public at premises with permission, but without invitation. Your duty of care may not be as high with invitees, but reasonable steps should be taken to ensure a safe environment.
  • Trespassers are members of the public on your property without your permission. Your duty of care extends to them with the agreement to not create deliberate danger.

At get indemnity we have the tools to access the wholesale insurance market. Compare public liability insurance quotes by completing our online application.


What is the cost of personal injury compensation?

Personal injury claims can be very costly when you consider that compensation can include expenses incurred, loss of earnings, possible loss of future earnings, pain and suffering.

The cost of defending potential personal injury claims can be significant, and you may not even be the cause of the alleged injury or illness.

The method used to calculate personal injury claims to account for the future investment return of a lump sum compensation payment was amended in March 2017 (and again in August 2019). The potential impact on how damages are calculated over a long period of time is substantial.

The rate reduction from 2.5% to minus 0.25% reflects the current investment return available for lump sum awards required to compensate a person over a long period of time.

Public liability claim example - A member of the public was injured while using the stairs and they sustained a brain injury requiring long-term care from the fall: A claim paid before March 2017 (+2.5% rate) equals £5.8m, whereas a claim paid after August 2019 (-0.25% rate) equals £10.2m.

The example above identifies what a significant impact the change in discount rate has on the potential cost of personal injury claims.


How much public liability insurance do we require?

The minimum public liability insurance typically offered is a £2 million limit. However, most businesses or organisations will typically purchase a minimum of £5 million or £10 million limit.

The limit you purchase will depend on your business activities, perception of the exposure and how much you are prepared to spend to mitigate the risk. 

Zurich have identified 4 Simple steps to choosing Public Liability Limits. Prudent businesses or organisations are increasingly purchasing an Excess of Loss policy to provide increased limits for public liability and employers liability and fleet insurance.


What is the Health and Safety Executive?

The Health and Safety Executive (HSE) provides a simple guide to your requirements under UK law. HSE and local authorities in the UK are responsible for enforcing health and safety legislation. 

HSE's role as a regulator includes a number of duties including: offering advice, information and guidance; raising awareness of issues; operating permissions and licensing in high hazard industries; carrying out inspections and investigations; and taking enforcement action.

Both employers liability insurance and public liability insurance play an important role ensuring you have the ability to meet any compensation awards.


Can you offer some guidance on risk assessments?

You are required under the Health and Safety at Work Regulation, to identify and manage risks within your workplace.

If you employ five or more staff, you are required to carry out a systematic examination of your work activities and record the findings of your risk assessment. The HSE offer guidance and tools to assist with completing a risk assessment.

A risk assessment ensures you have considered all possible dangers and hazards, allowing you to determine what you can do to prevent them. A good risk assessment will identify practical actions to managing the risk of harm and injury to people.

Risk assessments should form part of an overall risk management strategy to identify, evaluate and control potential threats to the business.


Are public liability claims required to be accidental?

The injury or damage sustained must be accidental, cover under public liability insurance is only intended to cover unexpected events.

If the word accidental is not used when specifying the insurance cover, there is usually an exclusion for injury or damage which results from a deliberate act or omission.


Can you provide cover away from your premises?

Public liability insurance will protect your company against compensation claims and legal costs if a third party suffers injury or property damage while on your premises.

Some insurers will offer the option to provide cover while you're working away from your premises. This is typically provided to accommodate a wide range of business activities, such as construction workers.


Do we require a public liability insurance certificate?

Unlike a certificate of employers liability insurance, UK companies are not required by law to display a public liability insurance certificate.

At get indemnity we can provide your company a certificate if required, as proof your public liability coverage.


How to compare public liability insurance cost?

Companies can compare public liability insurance cost from the wholesale market with our online application. At get Indemnity we have the digital tools to access a wide range of insurers to provide competitive quotes.

We continue to see soft to stable market conditions for public liability insurance, driven mainly by an abundance of insurer capacity and stable claims environment.

It is common to purchase a package insurance policy, which includes employers liability, public liability and products liability, under one combined policy.

As a specialist public liability insurance broker, we can tailor your cover to meet your specific needs. Please contact us and we can discuss your requirements.

 

Compare public liability insurance quotes online


This guide is for information purposes and based on sources which we believe are reliable, the general risk management and insurance information is not intended to be taken as advice with respect to any individual circumstance and cannot be relied upon as such.