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If you own or run a business of any size, public liability insurance is a must. It serves to protect you and your business against any claims for accidental damage caused to property or an individual (including death) whilst at your premises or as a result of your business activities.

As per the rules, the public liability insurance is a must if your own or run a business – of any size! The right insurance policy will protect you and your business should there be any accidental damage caused to your property or an individual whilst at your workspace or as a result of your business activities at your workplace or outside. Having right protection in place, can save you and your business against hefty amounts of claims that are in the tune of tens of thousands of pounds that otherwise can have serious detrimental effects on your business.  

Considering the number of documented claims under this policy over the years, it becomes utmost essential for you to protect your business and yourself in the unlikely events. Can you ignore this, certainly not!

How does it work?

To put it simply, let us take a scenario to explain PLI to you: Imagine you business involves customers visiting regularly to your premises. One of your employees plugs in a carpet cleaner and runs the cable along the floor. Suddenly a customer in your shop trips over that cable and breaks his knees. With their rights, the insured customer can sue your business because the accident was caused as a direct result of business activities and / or negligence on the employee’s behalf.

Now, you can imagine the cost of any legal fees, NHS medical costs and compensation payments arising from the claim amounting from a few thousand of pounds to tens of thousands of pounds. However, having protected through a right Public liability insurance, you as a business owner can safeguard your business, your employee or yourselves against this whopping costs which otherwise can have a devastating consequence on your business.

Who needs public liability insurance?

Whether you run a small business from home or have separate business premises if you have visiting customers or clients then you need it. And in the case you being a contractor (plumber, builder, and electrician etc.) visiting your client’s premises then you need it to cover yourself against any damage caused to their property or injury arising as a result of your work for them.

Having PLI is not mandatory by law but certain professions will need to have in order to do business.  

How much cover do I need?

Of course, this is just a basic example to illustrate how public liability insurance works. What you need to think about is how much cover you’re likely to need. Most insurance companies offer cover from £1million. This may sound a lot, but if your business operates in a high risk industry, you may require more cover.

Public liability cover for small to medium enterprises (SME’s) usually has a maximum limit of £10million. Consider your limit carefully as being under-insured can sometimes be as detrimental as being un-insured.

You may also find that some of your contracts stipulate a minimum cover level in this area. This is especially common when working with a local authority and you will usually need cover of at least £5million to satisfy their terms and conditions.

We know you must be having a load of questions that we recommend you should ask to an Airborne IFA before you choose your right Public Liability Insurance. Some of these questions can be:

  1. How do I choose the right policy?
  2. What does public liability insurance not cover?
  3. What factors affect Public Liability Insurance costs?
  4. What would be the premium and payment schedule of the policy that you choose?

Sometimes, no matter how hard we try, accidents are unavoidable so it’s imperative you take out adequate cover. Many small businesses would find it difficult to foot the bill for expensive legal costs and compensation payments arising from an accident or damage to a customer's property, so purchasing a comprehensive business insurance policy can really be a lifeline.

And remember, because an Independent Financial Adviser has access to a wide range of insurers, you can be certain you are getting the most suitable deal available as per your situation.  

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