What does public liability insurance cover?
A typical policy can respond to compensation claims and legal costs after accidental third-party injury or third-party property damage arising from insured business activities. The wording, conditions and exclusions decide the result.
UK business guide · Check the documents before buying
In brief
Think of it as protection against certain consequences of an accident, rather than a maintenance guarantee for your work. The insurer will still want to know what happened, whether the work was insured and whether policy conditions were followed.
How to approach the cover
There is no shortcut in the business description. It should cover the routine jobs and the less frequent work that can carry more risk.
The quotation should describe the risk and the policy should reflect that description. Keep both sets of documents so you can compare them.
The following situations are a useful reality check: medical or compensation costs after an injury; repair or replacement of damaged third-party property; and legal expenses involved in defending a covered claim. These examples do not promise that a claim will be covered. They bring out details that a broad business label can hide.
The provider may need a clear account of: what happened and when you first knew about it; witness details, photographs and job records; and any letter, email or demand from the other party. Do not make a risky activity disappear by choosing the nearest convenient description.
Check that the final wording follows the answers supplied during the quotation. An unexpected restriction should be queried. Do not leave a doubtful restriction until somebody asks for the certificate.
Jobs and situations to mention
Think about the following before asking for a price:
- Medical or compensation costs after an injury
- Repair or replacement of damaged third-party property
- Legal expenses involved in defending a covered claim
One incident can involve more than one part of a policy. Report the facts and let the insurer consider them.
Use “legal expenses involved in defending a covered claim” as a practical example. Describe the people, property and work involved, just as you would if explaining the job to somebody outside the trade.
Then consider “medical or compensation costs after an injury”. If it is a regular possibility, it should be recognisable from the business description and quotation answers.
Stay with work the business genuinely carries out. The aim is an accurate description, not a list of unlikely disasters.
Prepare the facts first
The quotation will be easier to complete if you first confirm:
- What happened and when you first knew about it
- Witness details, photographs and job records
- Any letter, email or demand from the other party
Work through “what happened and when you first knew about it”, “witness details, photographs and job records” and “any letter, email or demand from the other party” using the business records already to hand. The aim is a fair description of the work, not a polished answer that leaves out inconvenient details.
Where a contract has prompted the purchase, keep its insurance clause beside the quote. That makes the required limit and dates easier to check.
Two reminders from this page are “deliberate acts are not accidents” and “the cost of redoing poor work may be excluded”; keep them beside the documents when you check the quotation. If the policy takes a different approach to “what happened and when you first knew about it”, ask about it before the cover is needed and retain any written reply.
Do not accept a description simply because it is the closest choice in a menu. Ask if it does not fit the work.
Compare cover
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Answer the questions carefully and check the policy documents before you buy.
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What the certificate does not show
- Deliberate acts are not accidents
- The cost of redoing poor work may be excluded
- Professional advice may need professional indemnity
Limits, excesses and exclusions answer different questions. Check all three rather than stopping at the headline figure.
A final check against the real work
Check the work diary for tasks involving heat, height, water, digging, treatment, advice or products. These are easily forgotten when they are not done every week.
Where an answer is an estimate, note the figures used. Update the provider if the eventual position is substantially different.
If a customer has set the insurance requirement, send the certificate only after checking it. The legal name, dates and limit should match what the customer reasonably expects to see.
The page has one more practical caution: professional advice may need professional indemnity; check how this affects the jobs you accept and ask for clarification if the policy takes a different approach.
UK insurance information
Useful starting points include the ABI liability insurance guide, the FCA Register and GOV.UK employers’ liability information.