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Do you need public liability insurance for your business?

We're all Business

Posted on Wednesday, June 3, 2020

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Think of what needs to be covered by insurance and you may picture equipment, your employees and the business premises. But what about unexpected accidents?


From someone getting injured to legal fees, you need to prepare for all unforeseen events. This is where public liability insurance comes to the rescue, as it can give you peace of mind, particularly as a small business, so you can concentrate on what you do best.


Here’s everything you need to know:


What is public liability insurance (PLI)?
PLI is an insurance policy that protects you (as the business owner) and your employees if you’re found to be legally liable for third-party claims suffered by them in connection with your business. This may include injuries and loss of or damage to property.


It’s important for most businesses since even something as minor as a scratch on personal property could lead to claims against you. It’s particularly important if:

  • Customers visit your business regularly (e.g if you’re a retail shop)
  • You work in the public sector (e.g. for an entertainment company)
  • You and your employees work in clients’ homes or on their property (e.g. a contracting business)


What does PLI cover?
Public liability insurance covers the cost of claims made against you by the costs related to defending your business (i.e legal costs).


Some common claims include:


Damage to property. This includes damage done to someone’s property while you or your employee are working on or visiting their property, for instance if you’re renovating a client’s roof and you break a window or your employee breaks it.


Legal expenses. The cost of hiring and paying a lawyer to defend your businessin the case of a lawsuit is covered by PLI.


Injuries. PLI covers injuries that may happen to your customers, guests or even the general public could lead to serious bodily injuries.


What doesn’t it cover?
Although public liability insurance comes in handy for unexpected costs, certain things won’t be covered. These may include:

  • Any injuries to you or your employees
  • Damage to your property
  • Legal costs when one of your employees sues you
  • Excess costs (an amount you have to pay towards a claim). For example, if there is damage worth R3,000 and you have an excess of R1,000, your insurer will only pay R2,000 of the amount.


What happens if I don’t have PLI?
If you choose not to get PLI, you won’t be penalised, but you may regret it. For instance, if you don’t have PLI cover and someone sues you or your company for any damage done to them or their property, you will have to pay out of your pocket. And it won’t be cheap.


What’s more, with legal cases, there will still be fees to be paid, even if you win a case. This is because while it’s possible to claim some money from the person who sued you, all the fees may not be paid back to you.


What kind of public liability insurance do I need?
The level of PLI you will need depends on your business. For example, if you work from home and don’t interact with people often, your business isn’t necessarily at a bigger risk. On the other hand, if you own a grocery store or barbershop, for instance, and interact with many people daily, you’ll need more cover.


This is usually because the more people visit your property and use your services, the higher the likelihood of incidents occurring. At Budget Insurance, our Business Insurance offers cover for all your public liability insurance needs.


You can have peace of mind that whether you work from home or with customers regularly, any legal costs related to injuries, damage to property and death, in some cases, will be covered. 


If you’d like to know more about public liability insurance and how we can help you look after your business, contact us for an instant telephonic quote. Alternatively, have a look at our website.