What you’ll pay for your public liability policy depends on a few factors, including the level of cover you need and the everyday risks your business faces. We look at some of the key considerations that affect the cost of this type of cover below.
What is public liability insurance?
Public liability insurance is a type of business insurance that can cover the cost of successful claims made against you if a member of the public is injured, becomes ill or dies because of your business. It can also cover the cost if their belongings or other property are lost or damaged and you’re held responsible.
Without this cover, your business would have to pay any compensation, medical costs and legal fees due, or pay to replace or repair their belongings.
You don’t need public liability insurance by law, but it may be worth considering if you have any contact with the public. It can also be a condition of client contracts or membership bodies, or the industry you work in.
How much does public liability insurance cost?
The price of public liability insurance depends on the nature of your business and the type of risk it faces, as well as factors such as your claims history. It follows that the riskier the insurer sees your business activities, the higher your premium might be.
For some businesses, public liability insurance may only cost a few pounds a month, but it can depend on how you interact with the public and the sector you’re in.
As well as your premium, you may have to pay an excess if you make a claim. This is the amount that you pay for each claim before your insurer covers the rest. You agree to an excess amount when you take out your policy.
What can affect the price of public liability insurance?
The cost of your public liability insurance cover could vary based on details such as:
- the nature of your business
- the size of your business
- your annual turnover
- the level of cover you choose
- how many people (if any) you employ
- where your business is located
- whether you have previously made any public liability insurance claims
- the excess you agree to pay towards any claim
» MORE: How much is business insurance?
How much public liability insurance should I get?
Your cover limit is the most your insurer would pay out if you made a claim, so it needs to be right for your specific business risks. Common claim limits range from £1 million to £10 million, though it can vary by provider.
If you work in a high-risk profession, you may want to consider a higher level of public liability insurance. For example, if you are an electrician, builder or cleaner who works with dangerous tools or chemicals that could cause severe injury or damage.
Clients may ask that you have a certain level of cover before agreeing to work with you. For example, government contracts usually ask you to have insurance worth at least £5 million.
It’s important to get the right level of cover, as you will be responsible for making up any shortfall not covered by your policy if a claim amount is higher than your cover limit. If you’re not sure how much cover you need, or if your business has special requirements, it may be worth speaking to a business insurance broker.
Get a public liability insurance quote
To find out how much public liability cover could cost, it’s worth getting a quote. That way, the quote will be matched to your business and the specific risks it faces.
You can buy public liability insurance on its own or as part of a larger business insurance package. If you’re also looking to take out product liability insurance or employers’ liability insurance, for example, you may want to consider a combined policy with the same provider.
It’s also possible to get public liability insurance for events, including one-day activities.
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