What is Business Liability Insurance?
Business liability insurance is a group of business insurance policies designed to protect you, your business, and your livelihood. For instance, if an incident at work leads to injury or illness affecting staff, customers, or the wider public.
Business liability insurance can help with the legal costs associated with defending liability claims and any compensation awarded against you.
Do I Need Business Liability Insurance?
In general, it’s very important to have the right business liability insurance in place – it’s your safety net for when, despite your best efforts, the unforeseen happens. Don’t assume that if you have a small business, you don’t need business liability cover.
Imagine if a customer has an accident and gets injured while on your premises, or as a result of work you have done and launches a legal claim against you. Without the right business liability insurance in place, the costs could quickly mount up and leave your business struggling to survive.
But every business is different and faces its own set of risks. A beautician for example, will face different risks to an electrical business, but even businesses in the same trade can have different business liability insurance needs depending on exactly what they do, for whom, and how.
Which Types of Business Liability Insurance Do I Need?
The first step is to understand what types of business liability insurance are available and what they cover. Then look at the risks you face, and the combination will help you to work out which covers you need.
The most commonly purchased types of businesses liability insurance are:
Public liability insurance
This cover is for businesses that interact directly with the public. That means anyone not employed by the company, so would include customers you meet face-to-face. This will cover you when an accident at work sees a customer injured or their property damaged, and can help cover the cost of defending legal action and compensation.
Employers liability insurance
If you employ people, this kind of business liability insurance is required by law. Like public liability cover, it is there to help with the cost of defending liability claims and compensation but it applies to injuries or illness affecting employees while at work.
Product liability insurance
This type of business liability insurance steps in when a member of the public is injured or their property is damaged. But unlike public liability insurance, it is specifically designed for an incident caused by products you make, supply, or repair.
Professional indemnity insurance
If you offer professional advice, you would be wise to take out professional indemnity insurance. This business liability insurance can help protect you if a customer claims they suffered a financial loss because of a mistake you made or errors and omissions in your advice.
Legal Protection Insurance
Though not strictly a business liability insurance cover, legal protection insurance can also provide a vital safety net if your business is in legal difficulty. It can cover legal expenses or prosecution fees in situations like employment tribunals, tax investigations, and civil actions brought against you under the Data Protection Act.
How Much Does Business Liability Insurance Cost?
All these kinds of business liability insurance can be tailored to meet your needs, from the type of cover you take out, to the amount of cover. But the real issue here is not simply cost – it is finding exactly the cover you need to protect your business at a price that’s affordable.
Quotes from well-known and specialist insurers, including: