Public Liability Insurance

Every business, no matter the size, has a duty of care to the general public. If a claim is made and your business is deemed negligent, the courts will award costs and damages against you. Where a business is the manufacturer or distributor of a product it may also be liable for the failure of those products that it sells under the Trade Practices Act.

A thorough Products and public liability insurance policy should provide the following cover for all your business activities:

Provision and coordination of a defence from claims made against your business
Where your business is deemed negligent; provision for payment of costs and damages, including compensation for bodily injury or property damage that are awarded against you

Therefore, every business should have a Public and Products Liability policy in place.

It is important to know that your policy will not cover you for criminal or wilful misconduct and most policies will exclude exports to North America and Canada (unless specifically included via an endorsement).

Who needs Public Liability Insurance?

All entities that have a legal status, from large commercial enterprises through to sole traders.

As organisations are becoming more risk averse, they require their business partners to have insurance in place. All property owners have a lease requirement that their tenants have a policy in place

Public Liability Insurance for:

  • Scaffolders liability
  • Commercial Cleaners (Incl. Shopping centres)
  • Recycling facilities
  • Transport Operators
  • Machine operators
  • Construction workers (all trade people)
  • Contract works (All Risk Cover) – for Registered Builders
  • Manufacturing units, importers and exporters
  • Security Industry insurance
  • Not-for-profit cover
  • Asbestos Liability

Important Tips

Always discuss with your insurance broker before you alter your business activities. This is vital so that the insurance policy can be amended to include adequate coverage for all your activities and/or products/services.
Do not enter into agreements that add a third party as an insured or have phrases like “hold harmless” or “waiver of subrogation”.
When checking someone else’s ‘Certificate of Insurance’, make sure that the business activity stated actually reflects the tasks they perform. It is very easy to purchase a cheap policy that in fact does not cover the organisation’s real occupation.
Be aware that not all ‘Certificates of Insurance’ are the same. You should take care if the insurer is not approved by the Australian Financial Services Regulator (APRA). A Certificate of Insurance is worthless if the insurer does not have the capital to pay a claim.
Always keep thorough documentation of accidents or incidents that may arise into a claim. Often claims are received many years after the event, so it is important to request current employees and witnesses to provide an incident report.

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