Public Liability Insurance
Compare cheap quotes for public liability insurance and buy cover online at ContractorsCompare.com.
Public Liability Insurance is sometimes referred to as third party liability cover and provides protection to your or your business in the event of a claim being brought against you for damage that you cause to someone elses' property or for injury to a member of the public caused by your negligence.
Who needs public liability insurance?
Public liability insurance is not legally required in the UK for tradesmen but it is advisable to arrange cover. As a sub contractor you may need to provide proof of cover to a main contractor before you can work for them. The main contractor's insurance policy will contain a clause that they check that all subcontractors have cover in place on a regular basis.
What does public liability insurance cover?
Any policy you buy from a major insurer will protect you or your business in th event that someone sues you for damage or injury you cause as a result of your negligence for which you are legally liable. It does not provide cover for you if you hurt yourself. See income protection insurance. You can never be certain that an accident won't happen, but if one did that resulted in serious damage or injury where would you get the money from to pay the claimant?
Public Liability Insurance is relatively inexpensive and the premiums for some trades can start from as little as £40 per year.
Public Liability Insurance - Legal Definition
The Insurance Company will indemnify the insured against all sums which the insured shall become legally liable to pay as damages and claimants costs and expenses arising out of accidental;
- injury to any person
- physical loss of or physical damage to material property
- obstruction, trespass, nuisance, wrongful arrest or interference with any right of way, light, air or water occurring within the territorial limits and resulting directly from the trade or business during the Period of Insurance
Choosing the limit of indemnity
This is the maximum amount that is
paid by the insurer in the event of a claim. You may be familiar with the term
"sum insured" and this is similar. Under a public liability insurance
you are provided with indemnity cover, which means that if a claim is made against
you the insurer will seek to make good the loss suffered by the claimant. The
limits offered by insurers are normally £1 million, £2 million and
£5 million. Some insurers will offer more but this is not the norm.
As a rule of thumb most tradesmen are taking a £2 million limit these days as this is the standard limit offered by the insurers. However, if you are self employed and doing your own work and just need the cover for domestic or small commercial projects then may decide that £1 million is adequate for the risks you face. However, it is the potential to cause life-long injury that will dictate the limit of indemnity you choose, as this where the costs can escalate significantly in the event of a tragic accident.
If you are working for a local authority you may be required to have a £5 million limit of indemnity. If you are working under a main contractor they may also require you to have a specific limit to tie in with their insurance conditions. Most insurer's will want any sub contractors to be insured for at least £2 million.
Getting cover for all your activities
If you carry out work across multiple trades it is essential that you provide the insurance company with details of all the work you do. If you don't you could face the prospect of having a claim repudiated.
As an example a bathroom fitter will be covered to carry out the installation of bathrooms, and all the jobs that form part of that trade, plastering, tiling, plumbing etc. However, should he then be asked to install a new central heating system (which he is quite capable of doing) he wouldn't be covered unless he had disclosed this element of his work to the insurers. Central Heating fitters are at greater risk of causing more damage than a bathroom fitter and the insurer's premiums reflect this.
If you are unsure if you have the right cover on your existing policy it is worth comparing quotes from us to see if you are paying the correct premium.
Understanding the exclusions
With all insurance policies there will be exclusions, many of which are specific to your trade and you should familiarise yourself with these before accepting a policy or renewing your existing policy.
Your insurance provider (broker or website) should give you a list of the insurers exclusions that form part of your policy and should provide you with a full policy wording.
When you compare quotes at ContractorsCompare.com you will be given the full details and we will answer any questions you have regarding the exclusions if you contact us
Understanding the excess payable
This is the amount that you, the policyholder must pay in the event of a claim
being made. Some insurers will offer excesses of £100 and some will want
a higher excess. Like the exclusions, the excess is dependent on your trade and the work you carry out. Unlike car insurance you can't reduce the excess by paying
a higher premium. Excesses only apply to claims for damage to property and not
for claims made for personal injury. Read through any quotes you are given or
policies you may have to get an understanding of the excess you are being asked
to pay.