Going into business for oneself is a challenging and rewarding experience, and everyday there are more Brits undertaking this exciting task. Unfortunately, owning a business isn’t just the constant influx of profit that some imagine; there are also risks involved. When employees sustain injuries, they’re usually covered under Employers Liability Compulsory Insurance, but if a member of the public is hurt, that’s a completely different story. Luckily, public liability insurance can help in these situations, but it’s imperative for every business owner to fully understand this insurance and how much they need.
What is Public Liability Insurance?
Public liability insurance is a type of insurance policy that protects business owners in the case that a member of the public is injured due to their company. These injuries sometimes occur at the business’s physical location, but a company will also likely be held liable if their negligence leads to an accident off of company property as well. This can include work being done at construction sites or even in a client’s home.
Furthermore this type of insurance covers many different losses that a business owner may experience after someone is injured. These losses include the victim’s medical bills, current and future loss of earnings and any additional damages a judge may impose. In addition, most policies also cover the legal fees that a business owner will face while defending themselves in court.
How much Coverage does a Business need?
There is no definite amount of insurance that applies to every company in the U.K. A person who runs their business from the comfort of their home, for instance, will likely need far less coverage than an individual who has a huge location that can accommodate hundreds of customers at once. The use of an insurance comparison website, such as Monkey Insurance, can help determine the right level of coverage when judging just how much public liability insurance they need.
- Size of Property: As mentioned above, a larger property can lead to higher risks of danger. There are far more areas for a manager to keep safe, and sadly, this can sometimes lead to things slipping through the cracks. Companies with larger locations will need more coverage.
- Workforce Size: The number of employees a company has can also play into its risk level. More employees means it’s more difficult to supervise everyone. This, in turn, means that there are far more chances for a single employee to make a mistake that could lead to another person’s injury.
- Legal Requirements: It’s very likely that there will be a legal minimum amount of insurance that an employer needs. This doesn’t mean, however, that this is all of the coverage that should be purchased. In fact, legal minimums likely won’t be enough coverage in case of a serious accident. Sadly, some companies just starting out can afford no more than this.
- Be Honest about Employees: A business owner must consider their work force when choosing public liability coverage amounts. Are their employees skilled laborers with decades of combined experience, or are they students that are still attending school? A less skilled and experienced workforce can lead to more accidents, so higher coverage amounts should be considered.
Having public liability insurance is absolutely essential for every business, but having enough coverage is really just as important. Coverage that ends up only paying for half of a person’s injuries will mean that a business owner will have to pay the rest out of their own pockets. While it’s not always the case, these situations can ruin a company. Being prepared with enough liability insurance will help an owner ensure that their business is safe in the long run.
Georgina Clatworthy is a freelance writer based in the UK. She regularly writes on topics relating to the liabilities and legal aspects of running a business. Choosing the right level of coverage when it comes to insurance such as public liability can be tricky. Comparison website, Monkey Insurance, can help by providing an overview of the available coverage as well as a choice of providers and premiums to fit every budget.