Do You Need Both Public Liability and Professional Indemnity Insurance?

If you are new to the world of small business, you may be assessing your insurance needs. While you may be surprised to hear that only certain types of insurance coverage are legal requirements in Australia, you should nevertheless consider taking out policies to protect yourself and your assets. However, it can sometimes be difficult to understand the various solutions. For example, what's the difference between public liability and professional indemnity coverage, and do you need both?

Public Liability Insurance

Public liability insurance is very important for organisations that have some form of direct contact with other people. For example, if you have a shop where people visit to purchase goods, you may be at risk if somebody were to slip and fall on a wet floor. In this case, they may consider it to be your fault and take action for damages. Public liability insurance would cover you here.

If you manufactured a product for sale to others and, somehow, a buyer injured themselves or suffered some other kind of loss when using your product, you could be similarly at risk.

Duty of Care

The main thing to remember here is that you always have a duty of care when you are interacting with other people, whether they be customers, suppliers or the general public. This type of coverage can protect you against claims for damage, pain and suffering and legal costs.

Professional Indemnity Insurance

Professional indemnity insurance can cover your business against a civil liability claim for damage or loss. If you are providing a service of some kind and give incorrect advice or produce substandard work, this may cause an issue for the other party.

Errors and Omissions

This can also include what is sometimes called "errors and omissions," in case you may give advice to a client that could cause to suffer a financial loss. The client may consider you negligent and could try to recover the cost of any damages they incurred.

You may need this type of coverage as well as public liability insurance, depending on the nature of your business and the type of client that you interact with.

Expert Advice

If you're not certain about your risks but want to be as protected as possible, discuss your situation with an experienced insurance adviser. They will help you create the right coverage so that you can continue running your business with peace of mind.