Do I Need Public Liability Insurance?

By Seamus S

In all honesty it is unlikely that getting public liability insurance will be high up on the list of things to do, yet it could be vital for you to have public liability cover as it will cover you against any legal claims. If you decided not to get cover then you run the risk of being liable for any damages you or your business may cause.

Anyone who has a small business or is self employed sole trader could be potentially blamed for any third party injury i.e. a member of the public, alongside personal injury you and your business can be held responsible for any damage to property.

The first thing to bear in mind when considering if you need cover is if you are dealing with members of the public and in what way are you dealing with them. If you are providing goods or services to the general public, then you can be held liable for any third party damage.

Even thought there is no legal requirement to have public liability cover, the law does state that a businesses or individuals pay for losses caused by the business or its employees. This means that if you don't have cover then you can find yourself paying out for any compensation that the court deem necessary to fix the wrong which occurred. Obviously this will be having to be taken directly out of the business and can be extremely damaging if the reparations are high.

If you work from home you will only need cover if you have customers visiting you on a regular basis, this is also applicable if you are visiting customers in their own home on a regular basis.

When you take out a policy you will be covered against the risk of causing any bodily injury or harm to the person or property of any third party, which has resulted from the ownership use and or maintenance of the insured businesses premises or services.

What you are not covered for is any claims made against you or the business for any negligent advice, for example if you where a doctor and made a wrong diagnosis. If you want cover for this then you will need to look into getting a separate professional indemnity policy.

Public liability cover can cost from as little as £60 a year, depending the nature of your business. A builder is likely to pay more for cover than a door to door salesman as the risk is higher. Other factors in the cost of your insurance will be the business turnover as well as how many employees you may have working for you. Anyone with a small business will need cover ranging from £1 million to £5 million, yet sub contractors working for the local council or government may be required to get cover of around £10 million.

Public liability insurance is the cheap and perfect way to get cover if your business was liable for any damages. Those who opt not to have cover may find themselves paying out for a large settlement and in turn losing their business and in some cases even their home.

Seamus has more articles on public liability.

Why PPI is Never Necessary

By Ross Taylor

I'm not a big fan of Payment Protection Insurance. There have been too many times during my career as a Financial Adviser that I have heard horror stories. People haven't been paid out due to small omissions on their application form, or something small such as their job title has changed etc.

I can see the benefit of PPI when it comes to mortgages though. Generally, if you have a PPI policy for your mortgage (known as ASU) the insurer will step in to pay your mortgage after you have been off work for 4 weeks. They will continue paying the mortgage until the first of these two events happen: either you return to work on 1year passes. This is obviously important as the mortgage can be a huge sum. It's especially important if your company don't have a sick pay policy. My mortgage is £900 per month so I'd really struggle if I was off work. Even if I were to knock my mortgage down to interest only I'd still have to drum up £800 every month.

On the other hand I don't really see the purpose of PPI on items like credit card bills and electronic purchases. With TV's, DVD's etc I recommend never buying these on credit to start with. What is £1000 today will only cost £500 next year, and only £250 the year after that. By "making do" you'll save a fortune. Stick with the rule of thumb that if you want it enough you'll pay in cash.

With Credit cards you should never buy anything that you can't pay off within 3 months anyway. By keeping an emergency fund you therefore negate the need to ever take out PPI.

In a nutshell avoid PPI when you have it offered. Even a modicum of planning means that it is just an unnecessary expense.

New FREE download available at http://www.uncommonadvice.co.uk Ross Taylor is the author of "Mortgages, Money and Magic" and "The No B.S. Credit Crunch Ready Guide to Buy to Let in 2008". Ross is a successful Financial Adviser specialising in First Time Buyers and Buy to Let. He owns over £2million worth of property in the UK and regularly gives lectures on Financial Planning.

The Importance of Public Liability Insurance

By Rakesh Gaikwad

One of the more common subsidiary's of the wider 'Liability Insurance', Public Liability Insurance, whilst not a compulsory business insurance, can be a lifeline for any working company or individual should something an incident occur with a member of the public.

What is it and why is it needed?

Ideal for any individual or company working with the public, or where the public visit a company's premises, Public Liability Insurance ensures that the company or individual is covered should an accident occur to a member of the public on their premises. Further to this, this insurance also covers any accidents or incidents that may occur when the individual or company is carrying work out on their client's premises.

Including the cost of all legal fees' that may occur, whilst not mandatory, Public Liability Insurance is highly recommended for anyone carrying out work with the public.

It has to be noted that this insurance only covers claims from third parties and not employees

of your company. This is where Employer's Liability Insurance comes into play.

What exactly does it cover?

Public Liability Insurance covers the individual or the company in the event of an accident on your premises or their premises. Imagine one of the following scenarios -

A small-scale wedding business has just opened its first shop in a small shopping centre. When trying on a selection or wedding dresses, a lady trips on one of the wedding dresses that has been left on a chair, trailing on the floor, breaking her wrist. Insurance would cover any expenses incurred should the lady pursue a claim against the business.

Out on location for magazine photo shoot, a freelance photographer leaves one of his tripods lying down on the floor. A member of the public walks by and falls over the tripod and injures her arm. Insurance will ensure that the photographer was covered if the member of the public claimed against them.

How much cover is needed and how much will it cost?

For small businesses, insurance with a cover of £1m will generally suffice. Whilst the figure of £1m may seem excessive, if an incident happened and several claims were made against the company or individual, then the costs can soon mount up.

The positive side about Public Liability Insurance is that, although the cover of £1m is a substantial one, it is not directly reflected in the premiums that are paid. It's impossible to give a 'general' premium cost, as it varies quite considerably from business to business. Companies such as pubs and shopping centre's will have a much higher premium than a self-employed consultant who works 90% of the time from home, as there is a much more higher risk that an individual will be injured in the shopping centre than there is when in contact with the self-employed consultant. However, for a small business with a modest footfall figure, insurance can be purchased from around £10 per month, which is a small fee to pay should something happen resulting in a claim needing to be made.

It is an insurance that all businesses should have if they have some contact with the public. It's not a compulsory insurance - but it definitely should be.

Motor Direct is an independent intermediary with a wide range of insurers, providing with choice and finding the policy that best suits your needs, and grant you discount where liability insurance is required if you wish to trade.