Public liability insurance protects you and your business from serious financial repercussions.
Whether you are in the construction business or run a small motel, the risk of injuring someone or damaging their property should not be ignored.
Public liability insurance can cover compensation costs, legal fees, medical costs and more.
Compare business liability insurance
What is public liability insurance?
Public liability insurance is a type of cover that protects you if your business becomes legally liable if someone is injured or their property is damaged.
It refers to damages from the physical surroundings and physical property rather than damages from services you provide. For example, it will cover you if someone slips and falls on your property, but not if you splash bleach into their eye while dyeing their hair.
What costs are covered?
If approved, your public liability claim will cover what you owe the person suing you, plus your legal fees.
What does public liability insurance cover?
Public liability insurance will generally cover you for the following:
Legal liability. Public liability insurance provides cover when a court finds that you are legally responsible to pay damages and additional costs for: damage to someone else's property, personal injury to someone else, and advertising liability
Legal costs. If a legal liability claim is made against you, your public liability policy will cover the costs incurred in your legal defence.
Differing levels of cover. Many insurers will offer you a choice of the maximum level of cover, for example $5 million, $10 million or $20 million.
Property in your care.You may be able to take out additional cover for damage to property in your care, custody or control. Covered items include personal belongings, temporarily occupied or leased premises and vehicles in a car park.
Cover for other people. Public liability will not only include you but any director, business partner, executive officer, shareholder or employee.
Cover for other activities. Many policies will allow you to extend cover beyond your normal business activities to include the provision of sports and child care facilities, first aid and ambulance services, and the provision of food and beverages to employees and visitors.
Products liability. Some policies will also include products liability cover for injury or damage caused by your products.
Damage to goods in possession or legal control. Provides cover for physical damage to goods that are not owned by the insured but are in their possession or legal control.
First aid expenses. Provides cover for expenses incurred by the insured for first aid given to other parties at the time of an injury.
Note: Professional indemnity insurance is offered by insurers in conjunction with public liability insurance.
After workers compensation, public liability insurance is one of the foundational forms of cover that very few occupations can afford to go without. It's not mandatory in most cases, but lawsuits of this sort can affect almost any type of business and leave you owing large sums of money.
Almost all businesses would benefit from public liability cover. Regardless of business size, public liability insurance is suitable if the business has a physical premise or operates in public (such as a mobile business). Here are some obvious examples:
Retail. Grocery stores, book shops and department stores have physical locations with lots of foot traffic, increasing the chances of someone getting injured.
Health and beauty. Gyms, physical therapy centres and hair salons also bring the public into their premises. Even solo professionals may need public liability if they carry equipment that could damage or injure a member of the public.
Hospitality. Restaurants, bars, clubs and cafes bring in lots of people while also creating a fast-paced environment where injuries are more likely.
The trades. Any business or independent contractor operating on a work site would benefit from public liability insurance, and in some cases are required by law or by contract to have it.
Entertainment.. e.g. dancers, performers, event organisers, etc.
Real estate. e.g. Landlords, strata management etc.
It's important to remember that public liability will protect business in these industries if they cause injuries or damage that are not related to the professional service provided.
How do I compare public liability insurance policies?
There's a lot more to business insurance than just public liability. You can speak to a broker or get quotes from different insurers to find what cover you need, at a price that makes sense for you.
Here are a few questions to ask yourself as you mull your options:
Does the insurer offer other products you need for your business? There are dozens of cover types a business might need beyond just public liability, and those business are better off going with someone who offers the whole package. It's more efficient, you might receive a discount and you can be comfortable knowing you're with an insurer who has a holistic view of your business risks.
What will your out-of-pocket costs be? Whenever your claim is approved, you'll almost always have to pay a small portion of the payout yourself and the insurer will cover the rest up to the insured amount. This is your excess. All else being equal, the policy with the higher excess will be the worse deal.
What will your payout be? If you need to make a claim, your insurer will have a limit on what they will pay out. The higher the benefit limit, the better for you. So make sure you take this into consideration when comparing policies
What's included? Not every policy will cover every instance of liability. For example, one policy may only cover you if the damage occurred on your property. Others will extend this to include damage you cause elsewhere, such as on house calls. Don't buy a cheaper policy over a more expensive one until you are sure it includes the cover you need.
Is anything excluded? Every policy has a list of reasons they won't pay your claim. For example, most won't pay for damage related to asbestos, and most won't pay your claim if you've done something illegal that caused the damage or injury. When comparing policies, make sure you can live with your chosen policy's exclusions.
How much does public liability insurance cost?
The average small business owner can expect to pay about $80.75 per month in public liability insurance. But you can expect costs to go up to over $600 if your business is considered high-risk. Finder took a look at two industries - food and construction - with a different number of employees to get a gauge on how much it costs to get cover. Here were the results:
Industry
Food
Food
Construction
Construction
Employees
5
10
10
30
Estimated Annual revenue
$200,000
$400,000
$500,000
$1,000,000
Insurer 1
$60.61
$64.56
$346.09
$670.79
Insurer 2
$60.87
$69.19
n/a
n/a
Insurer 3
$144.41
$230.79
n/a
n/a
Average cost (per month)
$88.63
$121.51
$346.09
$670.79
Quotes were taken from BizCover's Insurance engine in March 2018. All policies have an excess of $500.
Ready to look at your options?
Whatever your business needs are, you can choose to get a quote online or speak to a broker. It's totally up to you.
What affects the cost of public liability insurance?
Here's what an insurer will generally take into consideration when coming up with your premium:
What your business does. Some businesses simply attract more risk than others. For example, the risk of injury or damage on a construction site will be higher than that of a retail store. Insurers will analyse what you do, compare this to past claims in that industry and factor this into your premium.
How big your business is. The larger the business, the higher the risk of injury or damage. For example, a sole trader (which makes up some 1.3 million businesses in Australia) or a company with just one employee could expect to keep its costs to a minimum, well below $100 per month. But when a small business enters the "10 to 19" employees category, the cost of the monthly premiums could skyrocket to an average of over $1,5001.
Your business location. You can expect a higher premium if your business is in a high-risk location, such as an airport, construction site, railway station or mine site.
The structure of your policy. You can affect the price of your policy by choosing a higher or lower excess or higher or lower benefit limits.
What's not covered by a public liability insurance policy?
There are two very important features that public liability insurance does not cover you for. These are:
Injuries to your employees. This is covered by workers compensation (e.g cover for injuries, illnesses in the workplace)
General exclusions
Every policy also has a list of general exclusions. These may differs between insurers, but your claim will typically not be paid if:
It relates to asbestos
It relates to your responsibility to injured workers (workers compensation)
It relates to punitive damages
It's caused by the operation, possession or use of an aircraft or watercraft
It arises due to defective work done or undertaken by you
It relates to products liability
It's for damage to property you own or that is in your care, except for vehicles and business premises
It arises due to the use of a vehicle
It relates to the cost of recalling, withdrawing, replacing, repairing, or refunding products
It's for certain types of advertising liability, for example a mistake in the advertised price of a product or service
It's for any liability or obligation that you assume under contract or agreement
It's caused by a deliberate act or omission by you or any employee
It's caused by electromagnetic fields or electromagnetic interference
It results from your Internet operations
It's for damage to computer data or programs caused by the use of any computer hardware of software
It's caused by a claim of defamation brought against you
It arises from the communication, display, distribution or publication of electronic data
It arises from the total or partial destruction, erasure or corruption of electronic data
It's caused by any breach of professional duty by you
It results from an act of war or terrorism
To find out exactly what is not covered, read the general exclusions of the product disclosure statement (PDS).
Talk to a broker about public liability insurance
Frequently asked questions
Public liability insurance premiums are considered a business expense and are therefore tax deductible. Each year you'll get a tax invoice from either your insurer or your broker, depending on who sold you the policy.
The indemnity limit has to be chosen on the level of risk your business is taking every day. For some industries, there are minimum levels, normally around $5,000,000. Generally, when you decide to buy public liability insurance, you decide the amount to insure, the so-called limit of indemnity, depending on the possible damage you could cause. This limit is usually set over $500,000 or $1,000,000. Public liability insurance coverage depends on the damage request of a third party. If the court or the judge states that you are accountable for financial compensation, this policy can cover all the claims up to the limit of indemnity.
It depends on the state. You should check with your state insurance commission whether your business should have mandatory public liability insurance. However, employers' liability insurance is required by many states.
Broadform Public Liability Insurance is the term given to policies that provide cover for both Public Liability and Product Liability. Not all policies will automatically cover both product and public liability so it is crucial to check the policy terms when signing up for cover.
Yes. Public Liability Insurance will generally provide cover for accidental damage to property that is owned or controlled by a third party.
Yes. There are a number of specialist insurers that offer Public Liability Insurance for one off events. Most larger insurance brands will not provide cover for single days/events but can extend cover to include additional cover that may be required for these events.
When you're a contract worker, public liability insurance offers many potential benefits. As a contractor, you run your own business and can be held legally responsible for your own actions, so you need to have an adequate level of financial protection in place if any claims are brought against you. Similarly, if you're a subcontractor, you probably won't be covered by the main contractor's insurance policy, so public liability cover is an important consideration. Without public liability insurance in place, the financial consequences of a claim made against you could be disastrous. The good news is that it's quite easy for contract workers to take out cover. Shop around for an insurer that allows you to tailor a policy to suit the specific cover needs of your business, and take advantage of the financial protection and peace of mind that this type of cover offers.
Gary Ross Hunter is an editor at Finder, specialising in insurance. He’s been writing about life, travel, home, car, pet and health insurance for over 6 years and regularly appears as an insurance expert in publications including The Sydney Morning Herald, The Guardian and news.com.au. Gary holds a Kaplan Tier 2 General Advice General Insurance certification which meets the requirements of ASIC Regulatory Guide 146 (RG146).
In order to find the right level of public liability cover assess the risks your business faces to determine just how much cover you need. Compare the benefits, limits and exclusions of a number of policies, while it’s also a good idea to obtain multiple quotes from competing insurers.
Public liability insurance will give assurance to the Church that the costs of any property damage if that has occurred through the negligence of the third party using the premises, will be covered. To get a sample quotation for the Public liability insurance, please submit your details via the form on the public liability insurance page, a business insurance broker will be in touch to discuss the different options available and provide you with a quote. This service is provided free of charge and there is absolutely no obligation to sign up for a policy.
Please ensure that you read through the relevant Product Disclosure Statements/Terms and Conditions before you sign up for a policy.
I hope this helps.
Please do not hesitate to reach out to us again if you have additional questions.
Hi, I have a dilemma and cannot find a satisfying solution to. I work as an Educator in my own home.
I am registered with the gov’t and come under the Family day care Scheme. This is my 9th year and my only working hours are from 7am -9am ( 2 HOURS ONLY ) ( Mon – Fri ) aka known as before school care. No one is interested in pro -rata. They insist I pay the same as other educators who do 10 hours a day. I make a measly $15.000 per year ( Hardly rolling in it ) Is there another option for me. Can you help please?
Thank you & kind regards
Molly
We understand that paying the same premiums with full-time counterparts can be challenging. :(
We suggest that you consult your concern with your local insurance commission to determine if it’s required to have cover in your employment conditions and what options you have under your present circumstances.
In case you’ll be allowed to take your own cover, you may send your details to a broker so that they can give you personalized services on getting the right quote.
You have contacted finder.com.au, a comparison and information service and not actually an insurer.
You can receive a quote for public liability insurance by entering your details into the enquiry form on the top of this page. Once you have done so an adviser will be in touch to discuss your policy options. This service is provided free of charge and there is absolutely no obligation to sign up for a policy.
finder.com.au is a comparison and information service and not actually an insurer. To get a quote for public liability insurance for your taxi, it would be best to reach out to an advisor through the inquiry form who will take all your circumstances into account and offer you a range of insurance options through insurers in our panel.
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I have a group meeting once a month in local church hall and are required to have public liability by the Diocese……can you help?
Hi Sandra,
Thank you for reaching out to us.
Public liability insurance will give assurance to the Church that the costs of any property damage if that has occurred through the negligence of the third party using the premises, will be covered. To get a sample quotation for the Public liability insurance, please submit your details via the form on the public liability insurance page, a business insurance broker will be in touch to discuss the different options available and provide you with a quote. This service is provided free of charge and there is absolutely no obligation to sign up for a policy.
Please ensure that you read through the relevant Product Disclosure Statements/Terms and Conditions before you sign up for a policy.
I hope this helps.
Please do not hesitate to reach out to us again if you have additional questions.
Cheers,
Ash
Hi, I have a dilemma and cannot find a satisfying solution to. I work as an Educator in my own home.
I am registered with the gov’t and come under the Family day care Scheme. This is my 9th year and my only working hours are from 7am -9am ( 2 HOURS ONLY ) ( Mon – Fri ) aka known as before school care. No one is interested in pro -rata. They insist I pay the same as other educators who do 10 hours a day. I make a measly $15.000 per year ( Hardly rolling in it ) Is there another option for me. Can you help please?
Thank you & kind regards
Molly
Hello Molly,
Thank you for the comment. :)
We understand that paying the same premiums with full-time counterparts can be challenging. :(
We suggest that you consult your concern with your local insurance commission to determine if it’s required to have cover in your employment conditions and what options you have under your present circumstances.
In case you’ll be allowed to take your own cover, you may send your details to a broker so that they can give you personalized services on getting the right quote.
Hope this helps.
Cheers,
Jonathan
hi, my name is Tracy and I am after public liability insurance for my wedding styling, hiring service company.
Could you please provide me with some quotes??
Thanks
Hi Tracy,
Thank you for your inquiry.
You have contacted finder.com.au, a comparison and information service and not actually an insurer.
You can receive a quote for public liability insurance by entering your details into the enquiry form on the top of this page. Once you have done so an adviser will be in touch to discuss your policy options. This service is provided free of charge and there is absolutely no obligation to sign up for a policy.
Cheers,
Zubair
I’m looking public liability insurance for my taxi
Hi Harjeet,
Thank you for your question.
finder.com.au is a comparison and information service and not actually an insurer. To get a quote for public liability insurance for your taxi, it would be best to reach out to an advisor through the inquiry form who will take all your circumstances into account and offer you a range of insurance options through insurers in our panel.
Cheers,
Zubair
How much would it cost for Public Liability cover for the amount of 5 million
Hi Bill,
Thanks for your question.
To speak with an advisor about getting a quote, please complete the quote form above and a broker will be in touch with your personalised quote.
All the best,
Richard