Members of the public who suffer injury or damage to property in connection with a small business could file a costly claim with a view to receiving compensation; a financial headache for any business regardless of size.
As a result, it is essential to have sufficient public liability insurance to protect yourself and your business in the event of injury or damage in order to avoid legal claims being brought against you. Insurance would cover the compensation payment as well as any legal expenses, so it’s a more-than-useful card to have in the deck.
It’s not just useful from a business perspective; it’s also essential for members of the public too. With the right insurance cover, a firm can operate knowing they’ll have the funds available to repair a customer’s property, pay for medical bills or replace possessions in the event of an incident.
However if you’re running a fledging startup business but remain unaware about public liability insurance and the different types of insurance on offer, here’s a quick rundown of the various forms of cover on the market and how they could protect your business in the future.
Product liability insurance
If your business involves selling or producing products, the onus is on you to ensure their quality and take responsibility for any problems that occur once they are sold.
If your products do cause injury to a person or damage to their property, your business would be liable to pay for any compensation claims. Even if you haven’t manufactured the product or imported it from outside the EU, you could still be liable if you have sold it. There are instances where the manufacturer is solely responsible but retailers will have to prove the products were faulty when supplied.
Consequently, product liability insurance is essential for businesses manufacturing or selling products to the public.
Employers’ liability insurance
An an employer, it is compulsory to take out employers’ liability insurance in order to protect your staff. Employees could become injured at work or ill as a result of working for you and could be entitled to compensation as a consequence. Your liability extends to contractors who become ill even after the person has left your employment, highlighting the importance of such a policy.
SimplyBusiness has outlined an example of a claim: A self-employed contractor was working exclusively for an insured business but injured himself while operating machinery. As the business was insured, the insurer paid out damages to the contractor under the employers’ liability cover at a cost of nearly £50,000.
If businesses neglect to take over employers’ liability, they could be hit with a fine to the tune of £2,500 fine for each day.
Combined liability insurance
Combined liability insurance does exactly what it says on the tin; it combines public, product and employers’ liability into all-in-one cover for a business. Depending on the type of business you’re running all three could be a requirement, making combined insurance a convenient way to protect your business from all angles. Depending on the provider, you could even get a discount by combining all three cover types into a single policy.
Many types of occupation need public liability insurance: builders, electricians, plumbers, ground workers, gas fitters, glaziers and a variety of other tradespersons. Don’t sell yourself short; research the various types of public liability insurance before it’s too late and you’re faced with a legal claim.