Are you covered with public liability insurance?

Whether you work in retail, hospitality, finance or engineering you’ve probably heard of public liability. In fact, most people probably wouldn’t even dare think of trading unless they had a public liability insurance policy in place.

Although in some industries, such as community organisations or property management it is compulsory to have public liability insurance, in many others it is often a pre-condition of trade or enforceable through business association memberships.

For example, a retailer in a shopping centre or a franchisee will almost certainly be required to have public liability as a pre-condition of trade. But what is it? In short, it protects your business for any physical injury or property damage suffered by a third party – potentially your customer.

So you’re an accountant and an elderly client slips on that shinny new wooden floor of yours – will your business compensate the client for medical bills with a few hundred thousand dollars out of its bank account? Probably not. Typically, businesses purchase between $10 million and $20 million worth of public liability cover. For office-based businesses, public liability can start from as little as $200, with doctor’s surgeries for example, starting at around $300 for $10 million worth of cover.

Of course, risk comes at a price and unfortunately if you happen to be in what an insurance company finds is a risky occupation, your business might have to pay a lot more for its insurance. Businesses such as grocery stores for example, can expect to pay between $1,000 and $2,000 whereas pubs or clubs can fork out up to $5,000 or more. In fact, some businesses are considered so risky that they can’t buy any public liability insurance at all.

In a litigious environment such as Australia, it would seem prudent to ensure that you have adequate protection – particularly given that in Australia, there is no cap on the amount of compensation awarded to a claimant.

However, in a commercial sense it can mean the difference between new business and no business with customers often more comfortable using service providers with adequate protection – wouldn’t you?

Author Bio: Vincent Moran, independent insurance specialist and chief blogger @ www.mybiz247.com.au – a free resource on insurance for business in Australia.

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