If you are looking to start or own a business, you’ve probably heard that you need to get public and products liability cover. If you’re a professional, such as an architect, bookkeeper or marketer, you may have also heard you need professional indemnity insurance. But what risks do these kinds of insurance protect against, and why are they so important? This article contains information to help you consider what your business may be accountable for.
Please note the information in this article is general in nature and does not take into account your objectives, financial situation or needs. You should consider obtaining independent advice before making any decisions based on this article.
Public liability Insurance
Public liability insurance protects your business in the event a member of the public is injured or has their property damaged while dealing with your business. Public liability insurance covers the cost of legal settlements you are liable to pay, in addition to covering your reasonable legal fees incurred to defend a claim against you.
If your business has a storefront, such as a café, hair salon, or fashion retailer, it will be no surprise to hear that you have a legal responsibility to members of the public that visit your premises. In the same way, if your work requires you to visit your customer’s property, such as a gardener or an electrician, you’ll have a legal responsibility to both the customer whose place you’re visiting as well as the general public. These responsibilities are often known as public liability – the liability your business has for the effect of its actions or property on members of the public.
Whether you’re starting a business or already established, it’s important to reduce the risk of liability as much as possible. The first step in protecting yourself is to identify and manage potential risks to customers and third parties that may exist within your business. The second step is to take out public liability insurance.
No two businesses are alike, and each will have differing insurance needs, although in some cases, public liability cover won’t be optional. For example, if you perform work as a contractor on behalf of another company they usually will require you to hold public liability insurance. Similarly, if your business premises are located in a shopping centre or mall, centre management will require a certain level of cover.
Like the name suggests, public liability insurance can help protect your business against compensation it is legally required to pay for death or injury to customers or third parties, or damage to their property.
Learn more about Public and Products Liability and what it covers
Products liability Insurance
If your business manufactures, services, alters, imports, installs or even repairs products, there may be a risk that, if they fail to work as expected or are faulty, these products could cause injury to the customer or a third party, or damage to their property. This could result in a legal claim brought against you, seeking compensation for injuries incurred or property damaged.
As with public liability insurance, you need to carefully assess what your business’s exposure is to potential products liability claims, and take appropriate steps to manage those risks. Taking out products liability cover can be the next step to protect your business against legal liability to pay compensation.
Allianz offers Public and Products Liability insurance which can help protect your business against the kinds of claims discussed above. Our Public and Products Liability insurance includes indemnity limit options of $5 million, $10 million and $20 million.
Professional indemnity Insurance
If you provide services or advice for a fee in a professional capacity, you may want to consider professional indemnity insurance. As a professional, you have a responsibility to your client to perform your service with due care and skill. If one of your clients makes a civil liability claim against you for events such as negligence, error or misrepresentation then you may face costs such as legal fees defend a claim against you and any awarded damages.
You may be surprised by how many occupations have this responsibility to their clients. Among other occupations, professional indemnity insurance can cover real estate agents, financial planners, accountants, public relation consultants and even travel agents. Professional indemnity insurance can help protect your business in an event of a claim made against you.
Allianz offers Professional Indemnity insurance through the Allianz Office Pack, available when you call our specialist small business team on 1300 131 000.
Allianz Business Insurance is issued by Allianz Australia Insurance Limited ABN 15 000 122 850 AFSL 234708. We do not provide advice on this insurance based on any consideration of your objectives, financial situation or needs. Policy terms, conditions, limits and exclusions apply. Before making a decision please consider our product disclosure statement. Also view the PDS update (privacy notice).
This article has been prepared by Allianz Australia Insurance Limited ABN 15 000 122 850 AFSL 234708 (“Allianz”). In some cases information has been provided to us by third parties and while that information is believed to be accurate and reliable, its accuracy is not guaranteed in any way. Any opinions expressed constitute our views at the time of issue and are subject to change. Neither Allianz, nor its employees or directors give any warranty of accuracy or accept responsibility for any loss or liability incurred by you in respect of any error, omission or misrepresentation in this article.