Public Liability Insurance for Small Businesses Isn't Always Mandatory, But Is Still Essential
Does your small business need public liability insurance? This largely depends on your definition of need. For some roles, particularly those whose work can only legally be performed with a licence (such as plumbers and electricians), then public liability insurance can be mandatory and is clearly needed—often being a condition of remaining a licensee. But what about other businesses where it may not be a legal requirement?
Physical Interactions
Any business that involves physical interactions with clients or members of the public can benefit from public liability insurance. Perhaps the only true exception is a home-based business whose operations are entirely remote (involving no in-person meetings of any kind). For all other businesses (where such insurance isn't a prerequisite for holding an operating licence), then public liability insurance can be a case of being safe, not sorry. However, it's a very strong case, with financial devastation sometimes being the alternative.
Legitimate Claims
No matter how unlikely such an event may be, this type of insurance protects you from legitimate claims of injury and distress arising from something that may happen on your premises. A prospective client or member of the public may slip and fall in your retail premises or while visiting your consultation space and might sustain an injury. They reserve the right to make a claim against you, even if due diligence (best process) was followed to prevent an accident from occurring.
Covering Your Liabilities
If a legal claim was lodged, such as if the claimant was seeking to recover costs associated with treating their injury, or from lost income while recovering from their injury, you may be found to be liable. And this is where your public liability insurance proves its worth, as it can cover your liabilities in such events.
Frivolous Claims Against Your Business
Even when such a claim isn't legitimate, your public liability insurance can be used to cover the legal cost of defending yourself against frivolous claims (which though perhaps rare, aren't entirely unheard of). This is relevant when there's any doubt as to the legitimacy of any claim against your business, and this legitimacy can be decided after consultations between yourself, your insurer, and after taking legal advice.
Even though the risk of any liability claim may be incredibly low for types of businesses, they can't be entirely ruled out, and your premiums are likely to reflect this low risk. As is the case with most forms of insurance, public liability insurance for small businesses is very much a case of being safe, not sorry.
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