Public Liability insurance vs Employers’ Liability insurance vs Product Liability insurance – the liability insurance differences explained

How does public liability (PL) insurance work?

Public liability insurance covers claims of injury or property damage by a member of the general public against your business. This could include customers, clients, suppliers or passers-by.

Public liability insurance can also cover the cost of your legal defence, compensation payments, and loss of income as a result of the claim.

PL insurance claims can be wide ranging, the most common examples demonstrate how PL insurance works and include the following:

• Slips – a customer visits your workplace and slips on wet floor, breaking their arm. As a result, they cannot work and claim against you for the financial loss suffered.
• Trips – a client trips over a loose wire and sprains their wrist. They make a compensation claim against you.
• Falls – a client falls down some stairs and breaks and ankle. They claim against you for the time they are off work and for rehabilitation costs.

Click here for further information about Caunce O’Hara public liability insurance.

Is product liability insurance the same as public liability insurance?

While there are similarities between the two types of insurance, in that they are designed to protect the policyholder against legal claims made in the event of accidents or injury, public liability insurance covers against injury caused to third parties (or damage to their property) due to your negligence, whilst product liability insurance covers against injury caused by a product that you have supplied.

Product liability insurance explained

Product liability insurance protects businesses from legal costs associated with a personal injury or damages claim, caused by a product your business has manufactured or distributed. In tandem with public liability insurance, these policies protect your business in the course of dealing with members of the public. Our business combined liability insurance includes product liability insurance as an optional extra to enhance your business protection.

How does employers’ liability (EL) insurance work?

Employers’ liability insurance is a legal requirement for anyone employing staff and protects businesses from the cost of defending a claim against you from an employee who has suffered injury or disease as a result of the work they undertake for you.

You will need it if:

• You deduct Income Tax and National Insurance Contributions from the money you pay your employees.
• You have control over where and when your employees work.
• You have the right to claim profit made by your employees.
• You provide the equipment and materials your employees use.
• You need them to perform the job you employ them for and if the employee is unable to provide a substitute if they are unable to work.
• You have part-time or temporary employees.

Click here for further information about Caunce O’Hara employers’ liability insurance.

The differences between the liabilities insurance policies at a glance

• Public liability insurance covers against injury caused to third parties (or damage to their property) due to your negligence.
• Product liability insurance covers against injury caused by a product that you have supplied.
• Employers’ liability insurance covers your business from the cost of defending a claim against you from an employee who has suffered injury or disease as a result of their work.

Caunce O’Hara offer public liability and employers’ liability insurance as part of a combined liabilities insurance package, with products liability as an optional extra. The policy also includes directors and officers liability insurance, portable equipment insurance, and cover for office contents.

Related Articles:

Professional Indemnity Insurance Explained – a guide to PI insurance 

Public Liability Insurance