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Do I need Public Liability insurance?

Public Liability insurance is essential for small businesses, providing cover against claims for physical loss or damage caused to a third-party as a result of your business activities.

It provides peace of mind for all kinds of business from professionals and tradesmen to retailers and other types of small businesses.

Is Public Liability insurance a legal requirement?

Public Liability Insurance is not a legal requirement in Australia for most businesses. However there are some situations where it is mandated before you can legally operate, Even though it’s not required by law for most businesses, all small businesses should r hold Public Liability insurance to protect them against personal injury caused to a third-party or damage to their property. No matter how careful you may be, if your business interacts with clients, suppliers or even members of the public there is the potential for a claim to occur, which could cost your business thousands of dollars in legal fees and compensation

Consider getting cover if one or more of the following apply to your business:

  • You have customers, suppliers or members of the public who visit your business premises, e.g. diners who visit your restaurant, or clients who visit your office, whether in a commercial building or home-based office
  • You manufacture and/or sell any kind of products, e.g. food, beauty products, furniture, clothing or household items
  • Working at your client’s site, e.g. a tradesperson carrying out repairs or work in other people’s homes
  • If your business hosts public events, like a stand at a trade-show attended by members of the general public

It’s important to take the time to consider the potential costs your business would incur should a Public Liability claim occur.

Did you know?

Public Liability insurance is generally a mandatory requirement for some trades when you operate under a state issued license, for example builders, plumbers or electricians.  Depending on the state or territory you work in and your occupation there are special requirements for your cover.   For example, it is a legal requirement in Queensland for electricians to hold the Consumer Protection extension with a minimum level of $50,000 cover in order to obtain an electrical contractor’s licence.

It may also be a requirement under a government or private client contract, or as part of a lease agreement for renting a commercial property.

Do I need Public Liability Insurance if I have a home-based business?

Running your business from home can bring a whole host of benefits like flexible working hours and not having to battle with peak hour traffic and public transport, but along with the benefits there are also potential risks for things to go wrong.

While you may automatically assume that everything will be covered under your home and contents insurance, this is not always the case when it comes to operating a home-based business. If you think you are covered under your home insurance policy check your Product Disclosure Statement, as most home insurance policies do not cover any liability arising from the operation of a business.

If your business has any interaction with clients, suppliers or any other third-party, or you sell any form of products, Public Liability insurance is a small price to pay for big peace of mind.

Image showing professions who need public liability insurance