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Why is public and product liability insurance important for businesses?

Why is public and product liability insurance important for businesses?
Public and Product Liability Insurance covers your business from claims made by any third party for compensation of an injury or damage to their property as a result of your business activities. So to ensure your business is adequately covered to cover the costs of a claim where you are found negligent or to defend such claim, you should consider the following examples; 

  • A customer trips or falls in your showroom or retail store
  • One of your employees reverses into a customer's fence
  • A customer's car is damaged during a regular service at your auto shop
  • A customer becomes ill after eating at your cafe
  • An angle grinder manufactured by your company injures a customer in their home
  • An electrician falls through a customer's ceiling
  • A crane falls onto a truck and injuries the driver
  • A customer trips over a step as they leave your home based office

In essence, a public liability claim can be made against a business if a customer or member of the public is injured in an unsafe environment, their property was damaged or a defective product leads to injury or damage. The list of potential claims against a company that interacts with the public is endless and can lead to significant financial and reputational losses.
 
Who needs Public Liability Insurance?
Consultants who work from home, contractors and trades people, businesses that have physical premises, and any company that interacts with customers or members of the public needs Public Liability Insurance. Whether you are self-employed or have 1000 employees, Public Liability Insurance covers you against injury, death or damage to property or possessions due to negligence caused by your business. Whilst Public Liability Insurance is not compulsory in Australia, obtaining a licence as a builder, plumber or electrician, for example, is often conditional on having this type of insurance. Also if you need to work at a construction site or other place of business, Public Liability Insurance can be a requirement before you are allowed to enter the workplace.
 
What does Public Liability Insurance cover?
Whilst each policy will differ between providers, generally this type of policy will cover your legal costs for defending or settling a claim, any settlement or compensation made by your business to the claimant, and any costs awarded to the claimant by the courts.

What does it not cover?
Public Liability Insurance does not cover injuries or loss to your employees, this needs to be covered under Worker's Compensation. So if one of your employees falls through a ceiling in a customers home, any injuries they receive will be covered under Worker's Compensation, not your Public Liability Insurance, but the damage to the customer's home will be covered under your Public Liability Insurance. Punitive damages are also not covered, as well as criminal activities. It's important to note that your Public Liability Insurance can be tailored to suit your specific needs, so it pays to talk to an insurance expert. To decide whether Public Liability Insurance is suitable for your business, talk to an insurance specialist today.

Management Liability insurance is designed to provide protection to both the business and its directors or officers for claims of wrongful acts in the management of the business.

A business insurance pack can provide cover for your business premises and contents, against loss, damage, theft or financial loss from an insured interruption to the business.

Purchase up to six products under one Business Insurance Package. 

In essence, a public liability claim can be made against a business if a customer or member of the public is injured in an unsafe environment, their property was damaged or a defective product leads to injury or damage. The list of potential claims against a company that interacts with the public is endless and can lead to significant financial and reputational losses.
 
Who needs Public Liability Insurance?
Consultants who work from home, contractors and trades people, businesses that have physical premises, and any company that interacts with customers or members of the public needs Public Liability Insurance. Whether you are self-employed or have 1000 employees, Public Liability Insurance covers you against injury, death or damage to property or possessions due to negligence caused by your business. Whilst Public Liability Insurance is not compulsory in Australia, obtaining a licence as a builder, plumber or electrician, for example, is often conditional on having this type of insurance. Also if you need to work at a construction site or other place of business, Public Liability Insurance can be a requirement before you are allowed to enter the workplace.
 
What does Public Liability Insurance cover?
Whilst each policy will differ between providers, generally this type of policy will cover your legal costs for defending or settling a claim, any settlement or compensation made by your business to the claimant, and any costs awarded to the claimant by the courts.

What does it not cover?
Public Liability Insurance does not cover injuries or loss to your employees, this needs to be covered under Worker's Compensation. So if one of your employees falls through a ceiling in a customers home, any injuries they receive will be covered under Worker's Compensation, not your Public Liability Insurance, but the damage to the customer's home will be covered under your Public Liability Insurance. Punitive damages are also not covered, as well as criminal activities. It's important to note that your Public Liability Insurance can be tailored to suit your specific needs, so it pays to talk to an insurance expert. To decide whether Public Liability Insurance is suitable for your business, talk to an insurance specialist today.
General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

All information above has been provided by the author.


Gail Findlay, IA South West, AFSL 240549

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