Public Liability Insurance – What it Means

Whenever people transport, manufacture, perform services, hold public events or interface with the Public, a liability appears. Savvy small and large business owners realize the need for economic protection claims that may occur from personal and property accidents and damage. Public liability insurance provides a safety net for injuries and damage claims that may occur.

No matter how many safeguards in place, tests and assurances, malfunctions, injuries and damage may occur. Once damage or injury has occurred, claims for negligence will arise. This insurance offers protection from suits affected by the adverse events. Without this insurance, companies can suffer economic disasters when required to pay out compensation.

The requirement for public liability insurance varies from state to state, and businesses need to do an individual risk analysis to understand what level of coverage is cost effective for the business. For some small businesses, the cost of such insurance can be economically unfeasible. Unfortunately if a successful claim against the business occurs, the cost may bankrupt the business.

Premiums for public liability insurance are based on the size, risk and type of public exposure. Big businesses with a large public exposure may require large public liability insurance policies. Places such as skating rinks, shopping malls accidents, Hotel Accident Claims , sporting accidents have more potential

When other factors are included such as the consumption of alcoholic beverages, the risks increase. Simple trip and fall accidents may result in large claims for injury. The risk calculated by the underwriter takes into account the amount of activity and exposure to potential accidents; the higher the risk, the greater the premiums and policy deductable.

People may erroneously believe such claims for damage and injury will not amount to large sums. A simple burn from hot food or beverage may seem innocent and low sum claims. The reality is that Court decisions for one million dollars are commonplace for claims including those “simple” burns.

Public liability insurance not only covers the cost of successful claims, the insurance covers legal fees. Legal fees can amount to thousands of dollars depending on the length and type of claim. These costs include accountant, attorney and when required, expert witnesses. The claimant legal fees, if a successful claim occurs, are paid through this insurance.

Public liability insurance provides an umbrella of protection for company assets. Whether the policy is for one, two, three or more million, these policies will provide a business with the ability to remain operational, viable and protected.


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