What Does Public Liability Insurance Cover? (2019 Update)
Although you may run your business safely, things can happen that are out of your control. Read about how public liability insurance can protect you here.
What does public liability insurance protect you from?Public liability insurance protects you from negligence claims. The financial and legal costs of these can be hefty. Along with covering the cost of medical treatment, you will also face costs for your lawyer.
What public liability insurance covers
Incidents (injury/death) occurring at your businessIf someone is injured or a fatality occurs at your business, it can be costly. Although this is something that no business owner wants, accidents do happen. What can be even worse is dealing with the lengthy Court process, legal fees and compensation for the injured or deceased.
Any legal and court costsLegal and Court fees can be expensive. If a third party suffers personal injury or property damage, your insurance will cover you. Otherwise, you could find yourself paying tens of thousands of dollars to resolve the matter.
Negligent advice given to a customer by your businessAlthough it’s important that you hire the right employees for your business and train them properly, mistakes can still be made. If an employee (or even you) give a customer negligent advice, they could have grounds to sue you. However, if you have public liability insurance, you won’t be liable.
Any loss or damage of propertyImagine that you run a busy electrical store. A customer comes in, carrying their brand new smartphone. They accidentally leave it on the shelf of the tablets they were looking at. When your customer returns a few hours later to pick it up, its been stolen. If something like this happens, a customer may have grounds to sue you. To protect you from being held liable for the phone being stolen, there’s public liability insurance.
Any damaged caused by your productsBusiness owners should only sell or display products that are safe for customer use. However, sometimes a product may end up causing damage. For example, the plastic cover of an electronic you sell may be torn. This becomes a problem if a customer picks it up and it injures their hand. If this occurs, having public liability insurance will protect you.
Protection for those not named in the policyA lot of insurance policies only cover those mentioned in the policy. An example of this is health insurance, or even CTP. However, if you had to update your policy for every new employee, you’d find yourself continually contacting your insurance provider. This is why public liability insurance covers people not named in the policy.
Nervous shock & emotional distressAccidents can cause shock and emotional trauma. Although this can be difficult to put a price on, customers can be compensated for this. Public liability insurance will cover you for any costs which relate to the emotional distress experienced by the claimant. Having public liability insurance means that you can be rest assured knowing an accident which happens at your business won’t mean the end of it. Beyond covering you for compensation claims and legal fees, having this insurance will also raise the confidence of your employees, in knowing that if anything goes wrong the business is covered. If you’re not sure whether you need public liability insurance, it is worth consulting with a business lawyer.
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Ananya is currently working in our content team as a Paralegal, aiming to provide free legal guides to facilitate public access to legal resources. Pursuing her interest in the regulation of emerging media, her work centres on the legal and business concerns engendered by the application of traditional legal principles to social media.