Public & Employers Liability Insurance
What is public liability insurance?
This type of insurance would cover a business if a customer or member of the public was to suffer a loss or injury as a result of its business activities and if that person made a claim for compensation. The insurance would cover the compensation payment plus any legal expenses.
Why is public liability cover a good thing for customers?
Even when a business does everything right there is always the chance of an accident happening. With the right insurance cover, a business can operate knowing that should the worst happen, their customers’ property could be repaired, their possessions replaced and their medical costs paid for.
What is covered in a public liability claim?
Policies are usually tailored to the individual business however as a guide, the insurance covers a business’s legal liability to pay damages to members of the public for death and injury or damage to property or possessions, which has resulted from the business’s activities.
For example, if you hired a roofing company to re-tile your roof but they didn’t use adequate weather protection, resulting in severe water damage, you could make a claim against them for compensation to pay for repairing the damage. Public Liability Insurance ensures that the company can meet the cost of the claim, along with any legal expenses.
Make sure the business you hire has public liability insurance
Make sure the business you hire has public liability insurance – Any business that has visitors to its premises or involves work on client sites needs public liability insurance. You should ask to see a company’s insurance schedule and documentation before taking them on.
Employers’ Liability Insurance – If you employ staff you must take out Employers’ Liability Insurance by law. This cover is designed to protect the interests of employees in terms of illness or accident at work.
What does employers’ liability insurance cover?
If you have employees there is a chance that they may be injured at work or become ill as a result of working for you. If this happens they might be entitled to claim compensation from you and you need employers’ liability to cover the cost.
An example of a situation where you would need to claim on your employers’ liability cover would be if an employee is injured while working on machinery without the proper safety precautions.
It also covers claims for employee illnesses that have been contracted as a result of working for you, even if they manifest after the person has left your employment. For this reason you must keep on file all documentation related to your employers’ liability insurance, even if it has expired.
An example of a claim
A self-employed contractor was working exclusively for the insured business. While at work he jammed his hand in between a lintel and a metal bar, causing a serious laceration.
What did the insurer cover?
The insurer paid out damages to the contractor under the employers liability cover at a cost of £49,990.
What level of employers’ liability cover do you need?
Employers’ liability claims can be very expensive and as such the standard level of cover given as part of business insurance policies is £10 million.
Details to look out for
- If you do not take out employers’ liability when you employ staff you could be asked to pay a £2,500 fine for each day you do not have it.
- Be careful to put down the correct number of clerical and manual staff if you employ both types.
- Immediate members of your family who work for you do not count as employees for employers’ liability insurance, however casual workers, part-time workers and temporary staff do count.