Public and Products Liability insurance may be referred to as a few different names. Tradesman/ Tradrerpersons insurance, PL, general liability and may also be packaged with Employers Liability and be classed as combined liability. Its also common to have this cover include within a package policy like office, retailers, commercial combined covers.
It protects your business from claims that may come from injury or damage to a someone else or someone else’s property as a result of your product or negligence.
Unlike Employers Liability this is not a compulsory purchase but can prove vital to protecting your business
What’s the Difference between the covers?
Public Liability protects you if someone (not an employee) is injured or their property is damaged in the day to day running of your business
Products Liability protects you against claims where there is injury or damage caused by an item you have manufactured, sold or supplied.
What limits of cover do you need?
£2m/£5m/£10m more?? Sometimes the limit you require may depend on a contractual requirement by one of your customers. Your level of cover depends on the work you do and the perceived risk. So you need to think about the possible extent of claims that occur should something go wrong. Things to consider here would be where you are working, the product you are manufacturing or selling and where or what that goes into, number of people that will interact with your business and how.
Do I need to buy Public/Products Liability cover?
No. Its not a legal requirement but many business take the cover to protect them from the costs of potential claims that may occur. It may also be a contractual requirement with your clients.
Where could claims happen?
Your premises – If customers visit your salon, shop, restaurant, retail outlet or whatever business you run.
You work at clients premises. You could be doing work at at a commercial clients premises or an individuals house
You work in Public. – builders, roofers, roadworkers etc all have the potential to cause injury to a passer by.
Typical types of claims may be:
- Slips trips an falls at your premises due to wet floors, uneven flooring, dangerous pavements or footpaths
- Injury from an object. This could be soothing sharp that’s hasn’t been covered or an unsecure item falling from height
- Injury due to bad signage. Banged heads on low beams or burns on hot surfaces
A plumber was contracted to fit a new bathroom at a home. He did the work but one of the fittings he installed failed causing hot water to leak through the house and also into the house next door.
The total cost of the repairs came to £160,000
A welder was called to do some work at a food manufacturing plant. The work failed and caused debris from the job and dirt to get into the food process. Production had to be stopped, repair work done and contaminated food disposed of.
Total cost of the claim was £146,000
What influences your premium?
As with most covers there are a number of factors that influence your premium but some of the main factors are:
- Occupation and trade
- Claims History
- Risk Management
- Limits required and excess/deductible
- Exposure to the public either on site or sales
- % or value of sales to North America
Best practices for preventing liability
Although purchasing public/products liability can give you peace of mind against liability claims there are other things you can do to protect your business, reduce the potential for claims and affect your premium
- Conduct annual risk assessments of your business and premises. identify key risks and establish ways to mitigate them making sure you record results.
- Provide full and proper safety training for all staff and encourage safe working practices on site
- Ensure that there is a comprehensive and strict testing of all products. Identify any potential problems or concerns.
- Review and assess the production of products and risk manage the process to reduce the potential for production of a defective product
- Maintain full and proper documentation of your suppliers manufacturers and quality control process
- Establish a comprehensive product recall plan
- Enforce a strict and thorough health and safety plan in the workplace to keep both employees and visitors safe while on your premises
Finally, make sure that your insurers are aware of the work that you do, the process you follow and the risk management you put in place to protect yourself. Is the fact that you are claims free for 10 years pure luck or because you take risk management seriously and have a thorough process in place to mitigate your exposure?
For more details or to discuss any issues that you have relating to your Public and Products Liability, or any other insurance cover, then contact us on 01204 201800 or at email@example.com