Public Liability Insurance

Whether you’re a small home business or a large company, it’s essential to have the right insurance in place. For almost all customer-facing businesses, public liability insurance is one of the main options you should be looking at. With a suitable policy in place, you can protect your business from unexpected curveballs that could set you back thousands of dollars, if not more.

What is public liability insurance?

Public liability insurance is a type of business insurance policy designed to protect businesses against claims of injury or damage to property as a result of their actions or on their premises. Without public liability insurance in place, businesses leave themselves open to potentially costly compensation claims or court proceedings.

What does public liability insurance cover?

The events that public liability insurance covers include:

• Injury or death caused to a person or people due to your business’ negligent activity
• Damage to, or loss of, a third party’s property due to your business’ negligent activity
• Legal expenses stemming from defending claims made against you in court
• Compensation required to be paid to a claimant if you’re found liable for a covered event

You can adjust the amount of cover you need (in dollars) based on the size of your business and the specific risks you may face. This can range from $5 million to $20 million. For instance, a large restaurant with high foot traffic would likely require more public liability cover than a marketing agency that only occasionally had visitors.

What does public liability insurance not cover?

It’s equally important to know what isn’t covered by your public liability insurance. Some of the events you might see covered under a different policy include:

• Injury or damage to third party property by a product you manufacture, sell or supply (product liability insurance)
• Injury to one of your employees while working (workers compensation insurance)
• Compensation claims arising from professional negligence or erroneous advice (professional indemnity insurance)
• Damage to your business’ equipment or stock (business contents insurance)

Is public liability insurance mandatory for my business?

There’s no overall legal requirement for certain businesses to have public liability insurance. However, there are some industries where public liability insurance is compulsory in certain states. These include:

• Tradies such as electricians and plumbers are often required to have public liability insurance where a state-issued licence is required to operate.
• Builders are often subject to the same requirements. For example, the Queensland Building and Construction Commission (QBCC) states that those who build or renovate in the state must have public liability insurance.

Should my business buy public liability insurance?

Whether public liability insurance is suitable for your business ultimately comes down to the risks it faces. Here’s a list of businesses and why they might need public liability cover:

• Tradies and construction businesses: when you’re working with heavy machinery and other tools to build or fix things, there’s a higher chance of something (or someone) being damaged. That’s why public liability insurance is essential for those working in these areas.
• Restaurants and cafes: these businesses have a high volume of people coming through each day, which naturally exposes them to more risk. In terms of risks specific to the industry, you can also be covered for incidents like food poisoning or burns from hot drinks.
• Retail businesses: another industry with high foot traffic, retailers are typically held responsible if a customer slips on an unsigned wet floor or trips over an ill-placed rack. In general, businesses with a physical presence and lots of customers are at greater risk.
• Hairdressers and barbers: being in close quarters with members of the public can also leave you open to public liability claims. This can range from accidentally cutting a customer’s ear to not sweeping the floor properly and having a fall. However, bad haircuts can be covered under professional indemnity insurance.
• Beauty and wellness businesses: people like beauticians, masseuses and laser hair removal technicians also contend with risks relating to injury to their customers.

How much does public liability insurance cost?

There’s a wide range of factors that can impact the cost of your public liability insurance policy. For tradespeople, public liability insurance quotes available through BizCover start from monthly premiums of $43.62 for carpenters, electricians, painters and handymen and $60.11 for plumbers*. BizCover also states the average monthly premium for each of the following industries across the 2023-24 financial year: