Public liability Insurance covers the cost of claims should your business activities result in the injury of a client, contractor or member of the public.

A public liability policy can also cover you and your employees against property damage when working in a client’s home, office or business property. Under the Injury Cost Recovery Scheme, the NHS is allowed to reclaim the cost of transporting and treating a patient in cases where personal injury compensation is paid out. So if your business activities injure a third party, public liability insurance will protect you from the cost of a possible NHS claim.

Our video guide to public liability insurance

We’ve pulled together this short video to help you decide whether public liability insurance is right for you:

Do I need public liability insurance?

If your business premises are visited by clients, or if your employees regularly work off-site, it may be worth considering this type of cover. If you work from home, you might assume you don’t need a policy, but this isn’t necessarily the case.

Say for example, you decide to take a marketing stand at your industry’s big trade show to get some publicity for your firm. But during the show one of the boards falls off and injures a passer-by – an embarrassing episode could turn into a costly one if that person decides to sue.

Also, if you visit clients’ premises or have access to their equipment then it’s worth considering buying public liability cover, because if you inadvertently damage their property you may have to pay the cost of repairing or replacing it.

It could be something as simple as knocking your cappuccino over your client’s new MacBook or one of your employees tripping over in a client’s server room. He brings a stack of expensive computer equipment down as he falls, which might seem like a classic ‘You’ve Been Framed’ moment at the time. But the £250 you’d earn from the trip (pardon the pun) wouldn’t begin to cover the cost of a new server when your client sends you the bill.

How much does public liability insurance cost?

How much you pay for cover depends on the size and type of your business, and the level of risk it undertakes. Discuss this with your insurer before you buy your policy in order to assess what level of cover provided is right for your business. You may find clients expect you to have a minimum level of cover, according to your area or industry. This is often the case for businesses working with the public sector where the minimum requirement is usually between £5-10 million.

Is public liability insurance a legal requirement?

Choosing not to purchase public liability insurance will not land you with a jail sentence or a hefty fine. But having the right insurance can make your business look more professional and offer you peace of mind. You don’t want to get into a spat with one of your best clients over the consequences of an accident or damage to one of their properties. Getting a public liability policy means you can let your insurer deal with any problems, while you get on with running your business.


Already have public liability insurance? Here’s five reasons why you may need to review your public liability cover.