It gives financial protection to your business if you are sued by a member of the public or a third party. It covers claims for:
Injury, e.g. a third party trips over your business equipment
Illness, e.g. a customer gets food poisoning from your restaurant
Death, e.g. you install faulty electrics which cause a fatal house fire
Property damage, e.g. your tools fall and smash a car windscreen
Do you need it?
You do not legally have to take out public liability insurance, but your business could be at serious financial risk without it.
Personal injury claims can cost millions of pounds, which could leave your business bankrupt if you do not have the right cover in place.
Your clients may also ask for a copy of your public liability insurance before they do business with you. It gives them peace of mind that you are covered if anything goes wrong.
How to find the right policy
Get as many quotes online as possible, then you can compare:
Liability limits: This is how much your insurer will pay if you claim. You can choose a maximum limit between £1 million and £5 million, based on the type of business you run. E.g. a construction company may need a higher level of cover than a tutor.
Cost: Compare quotes from different insurers before you take out cover, to get the cover you need at the cheapest price. You can save money on your premium by choosing a high voluntary excess, or paying up front in full.
If you are unsure what cover your business needs, speak to an insurance broker who can offer you advice on finding the best insurance.