When to Buy Public Liability Insurance

Written by
Public Liability Insurance
Aileen Danna

You are up against threats every day, especially when it comes to financial matters. That is why it is essential you insure yourself by obtaining the right cover. Public liability cover protects business people against claims made against their business in cases where the directors, employees, owners, or sub-contractors of a company are found to be responsible for the injury of a third party or a third party’s property.

Samples of Claims

For example, suppose you run an electrical firm and you are held responsible for causing a small fire in an area of a client’s building. A claim is made against you for fire damages – damages that were caused by your company when electrical wires were replaced. Or, maybe you own a construction firm and one of your employees moves a piece of lumber that hits someone on the building site. The individual who is hurt makes a claim against your company.

When you take out this kind of insurance cover, it also covers any legal costs that are related to defending the claims that are brought against your business. The premiums for the protection are based on several factors, including the kind of business that is insured, the number of employees, any previously filed claims, and the projected turnover. The insurance also includes protection against claims that arise out of the manufacture of defective products. However, this insurance protection is normally referred to as products liability insurance.

Public Liability Insurance

Part of an All-inclusive Package

On tender documents, public liability insurance is also called PL insurance. The protection is one part of an overall insurance plan. Sometimes companies include employers’ liability cover, contractors’ all-risks protection, personal accident insurance, and machinery cover.

The regular PL limits that are available on the current market in Ireland are €6.5M or €2.6M, respectively. Typically, the second amount is sufficient to cover for most businesses. However, if necessary, higher limits are also available that go up to €50M.

If a mishap occurs and a claim is filed, the injured party, known as the plaintiff, makes a claim against a business for the injury. The insured then notifies the insurance brokers about the claim. Any requested information is supplied and the insurance company goes ahead and deals with the legal complexities of the matter. If the claim is found against the business, the insurer pays for the compensation and related legal costs. If the business wins, the insurance company will collect the legal costs from the plaintiff.

If a business does not have PL, it will have to find a solicitor and provide the legal counsel with any requested information. The solicitor’s costs often begin at €5,000 and go upwards. A business may decide to settle out of court, paying both for the compensation and the legal costs. Even if the company wins, it still has to pay the costs for legal representation.

Obviously, paying for PL cover can be a major factor in the decision of a company to choose the protection. However, costs for the insurance have fallen significantly in the past few years. Therefore, anyone who needs the protection cannot lose anything by obtaining a quote. In today’s litigious world, having the cover is becoming more and more important.

Article Categories:
Finance

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