Where to buy public liability insurance?

Public liability insurance can be bought directly with an insurance provider, through a comparison site, or with a broker. All business insurance providers will offer public liability insurance as it is one of the most popular types of business cover taken out. 

NimbleFins, Simply Business and Compare the Market are a few sites that enable small businesses to get and compare public liability insurance. Direct Line, AXA, and Hiscox are a few household names but don’t discount lesser-known companies as well.

When deciding which provider – or broker – to use it is worth checking their customer ratings using online tools such as Trustpilot, Reviews.co.uk and Google. Take a look at the poorer reviews to see if there are any red flags. Also, consider how many reviews they have had. If they have a five-star rating but only nine reviews, it may not be the biggest endorsement. 

How do I get public liability insurance?

Firstly a business needs to assess risk factors and the amount of cover it needs before getting public liability insurance. Public liability insurance policies have different limits for compensation payouts and legal fees. For example, there may be a £2 million limit for injury and damages, but only a £100,000 limit for legal expenses.

Small businesses generally get public liability insurance with maximum protection of between £1 million and £5 million. This can depend on the type of industry the business is in, the amount of contact it has with members of the public or other third parties, the risk of an injury or damage to property happening and the cost to put it right. A sole trader dog walker would usually take out much less insurance than a builder who could cause significant damage to a house if something went wrong, for example. 

Once a business has decided how much insurance it needs it can either go direct to insurance providers or brokers for quotes or use a comparison service. Remember, when going direct, the assistants work for the insurance company, not for you, so may not always come back with the best price that might be available in the market. 

A business will typically be required to answer a few questions including the nature of its business, how many people are employed, annual turnover, how long the business has been trading and whether the business has premises. There are many comparison sites out there such as NimbleFins or Simply Business that can connect customers with brokers and direct insurers, or customers can go through a broker via the British Insurance Brokers’ Association (BIBA).

What is a public liability insurance policy?

A public liability insurance policy offers protection against the legal and compensation costs of a third party suing for injury or damage to their property. 

It covers medical bills, costs of repair as well as damages and the cost of legal representation. 

This could be for anyone not employed by the business, such as a customer, supplier, landlord, etc. 

Although not a legal requirement, any business that is public-facing or comes into contact with the public is wise to take out public liability insurance. 

This could be tradespeople, such as electricians or builders who work on the premises of a customer’s home, or businesses such as hairdressers or shops where customers come to their premises. Or it could be a business that works in public such as a construction worker. 

There are many scenarios where public liability insurance could be needed, with a few examples set out below:

  • A hairdresser customer trips over a cord and they sue for compensation.
  • Part of a roofer’s scaffolding falls and hits a member of the public walking by.
  • A tree surgeon misjudges a tree and a branch falls on a parked car – the insurance would cover the cost to repair or replace the car.
  • A restaurant has a fire that spreads into the shop next door and must pay for repairs to the neighbouring building, plus compensation for lost stock. 
  • A shopper trips over part of a market trader’s stall and breaks their leg, suing for compensation to cover time off work and medical bills. 

How to apply for public liability insurance

It is wise to get multiple quotes before signing up with a provider. This is because some companies will charge a lot more for essentially the same coverage. Sometimes it may be that an insurance company has taken on too many businesses from the same industry recently and does not want to add to its own risk. In this case, there is nothing a business can do, so it is always worth scoping out a few different providers. 

Insurance advisors, such as the well-established NimbleFins, can help with finding quotes from several providers after a business fills in a short form. 

It is also worth a business asking a few questions when deciding the type of cover to take:

  • How much does the business/its employees come into contact with customers or members of the public?
  • Could injury or damage to the public’s property occur due to the business’s activities?
  • Does a client require public liability insurance as terms of their contract and if so is there a minimum amount of cover that is required?
  • Does the business belong to an industry body that requires a minimum amount of public liability insurance?
  • Will public liability insurance make the business more trusted with customers/will it set the business apart from competitors? 
  • How much would legal fees and compensation claims be if a third party was to sue the business? Could the business afford to meet these without insurance?