It‘s one of the most common types of insurances for tradies, but do you really know why? We break down the ins and outs of Public Liability insurance and what you need to know, without the boring bits.
So what is Public Liability insurance?
In a nutshell, Public Liability insurance* is there to protect you and your business if a customer, supplier or member of the public were to injure themselves or experience property damage due to your negligent business activities.
It also provides assistance with the legal costs associated with managing claims that are covered by the policy.
Why do tradies need to consider Public Liability Insurance?
Unless you’ve got a money tree growing out the back, the financial consequences of a claim could not only put you out of business but jeopardise your personal finances too. Public Liability insurance covers your back when things don‘t quite go plan.
As a tradie, it can even be a contractual requirement that you have Public Liability insurance in place well before picking up the tools and putting boots on site. Always check the level of cover that is required, as there are different limits available.
Lets take a look in further detail, some of the typical reasons why you may take out Public Liability insurance as a tradie.
1. Accidentally causing damage to someone’s property
Working with different tools, moving building materials and just getting the job done are all opportunities for things to go wrong, potentially causing a claim. Even if you take all the care in the world, let’s face you are only human and accidents and incidents can happen in the blink of an eye.
Something like accidentally bursting a pipe, knocking over an antique vase or demolishing the wrong wall of a structure are just some of the types of incidents that could land your tradie business in hot water, causing big issues especially to your finances and reputation^.
2. Accidentally inuring someone
If you think the financial impact of a property claim is costly, think again. The impact of accidentally causing injury to a third-party can have a massive impact on your tradie business and it is something no small business owner wants to be faced with.
Even if you all the safety measures in place, third-parties can still experience slips, trips and falls around work sites. All it takes is for a client or member of the public to trip over a lose power cord, fall and injure themselves for a Public Liability insurance claim to occur^.
3. You may need it for your licence
Different trades will have different requirements as to what is required to obtain a licence. It is a common request for some tradie businesses to have their own Public Liability insurance sorted. If you are unsure if you need to have it and also the level of cover required, get in contact with your industry board for the details.
Not only are there varying requirements from trade to trade, but each state and territory has their own rules and regulations for obtaining a license. If in doubt, check it out.
4. You may need it to work on site
Builders and project managers would be aware of the real-life risks that take place when working on a site. To help keep everyone safe, you may find as a tradie that you are required to have your own Public Liability insurance in place, well before your boots hit the soil.
Before picking up your tools, make sure you also have the right level of cover in place as a minimum level may be needed as part of the process. Make sure you also have proof of your Public Liability insurance policy ready to show too.
Some of the not so typical work sites which you may also still be required to have Public Liability insurance include places like work for real estate agents and property managers. They may also request you have your own cover sorted before you start working on any of their properties.
5. It protects your tradie business and gives you peace of mind
There’s plenty to think about and manage when you run your own tradie business and the last thing you want hanging over your head is the threat of a claim. The financial consequences, depending on the size of the Public Liability claim could be enough to cause you to hang up the tools for good.
Things like the related legal costs and compensation if awarded to the victim can run into the thousands if not more. Without having the right type of protection in place, not only are your business finances on the line, but it may also put your personal assets at risk of being lost too.
You need to also consider the impact a claim may have on your tradie business’ reputation as well. Not having Public Liability insurance in place and being able to cover a potential claim could wreck your business for good with both your clients and with your peers within the industry.
Having adequate Public Liability insurance in place gives you peace of mind, knowing that there is a safeguard in place to protect your business when it may need it most.
What does Public Liability insurance typically cover?
- Personal injury suffered by a third party (e.g. a customer, supplier or member of the public) due to your negligent business activities
- Damage to property owned by a third party due to your negligent business activities
Legal and defence costs associated with a covered claim
What does Public Liability insurance typically not cover?
- Injuries to your employees
- Damage to your own property
- Costs of rectifying faulty workmanship
- Professional negligence
- Contractual liability
- Events occurring before or after the policy period
A real-life Public Liability claim
The insured was a plasterer installing a ceiling. When he went inside the building, he put his foot on the wrong timber and broke the plaster. The plasterer‘s insurer settled the claim paying just under $1,000 for the damage.
Sorting out your Public Liability insurance shouldn‘t be a hassle and at BizCover, our goal is to make insurance easy. Jump online or on the phone, provide a few details about your business to receive multiple quotes from some of Australia’s leading insurers in minutes.
Paperwork and jargon is not our style, so there are no forms to fill out asking for your life history, just the stuff we need to know to get you covered.
^The provision of the claims examples are for illustrative purposes only and should not be seen as an indication as to how any potential claim will be assessed or accepted. Cover for a claim will depend on the specific circumstances around the loss and would be subject to the terms and conditions of the policy concerned.