Public Liability Insurance
No matter your business's industry, it needs protection against liability claims from the general public.
Written by
Christine Lacagnina has written thousands of insurance-based articles for TrustedChoice.com by authoring consumable, understandable content.
Reviewed by
Cara Carlone is a licensed P&C agent with 20 years of experience. She has her P&C license in RI and TX and holds CPCU, API, and AINS designations.
No matter how safely your business operates, unfortunately, it can't possibly prevent all incidents. One of the most common threats to businesses is claims from the public related to accidents, injuries, and personal property damage. Fortunately, you can protect your business against losses from lawsuits related to these incidents with public liability insurance.
A local independent insurance agent can help your business get equipped with the right pubic liability insurance. They'll get you matched to the ideal amount of coverage for your unique company's risks and exposures. But until then, here's a deep dive into public liability insurance, including what it covers and when it's necessary.
What Is Public Liability Insurance?
Public liability insurance is an older, and many times outdated, form of general liability insurance. This coverage is part of a larger business insurance policy that protects against claims made by the general public related to accidents, injuries, and property damage. Public liability insurance can be applied to claims made against your business by customers, delivery workers, visitors, and other members of the general public.
However, a general liability insurance policy offers similar but broader coverage for businesses today. In fact, most insurance companies suggest businesses choose general liability insurance instead of public liability insurance when building their policies.
What Does Public Liability Insurance Cover?
Public liability insurance is designed to protect your business against costs associated with lawsuits filed against it by the general public. These claims can be related to the following:
- Accidents
- Bodily injuries
- Personal property damage
Any of these incidents can occur on your business's premises or somewhere else if the harm is caused by your company, its workers, or its operations in some way. Public liability insurance can cover the cost of your legal defense in a lawsuit, including attorney, court, and settlement expenses. It can also cover medical expenses for injured third parties or pay to repair or replace damaged or destroyed personal property.
When Do You Need Public Liability Coverage?
Liability coverage is critical for protecting your business against costly lawsuits, regardless of your industry. A small business might choose public liability insurance because it's one of the most affordable types of liability coverage available and one of the most basic.
However, general liability insurance provides all the coverage included in public liability insurance and protects your business on a broader and more comprehensive level. That's why most businesses today, especially larger businesses, are advised to get general liability insurance instead of public liability insurance.
How Much Does Public Liability Insurance Cost?
The cost of public liability insurance can vary widely depending on the type of business you run and many other factors. These often include the following:
- Business industry
- Business location
- Business size
- Number of employees
- Annual revenue
- Prior claims history
While the cost of your specific business's policy can be difficult to predict, on average, many small businesses pay about $67 per month for general liability insurance. Public liability insurance may be a bit cheaper. An independent insurance agent can help you find affordable public liability insurance near you.
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What Other Types of Business Insurance Are Recommended?
The larger your business and the scope of its operations, the more types of coverage it's likely to need. Here are some of the most common types of business insurance to consider adding to your policy:
- Commercial property insurance: This can reimburse you for repairs or replacements to lost, stolen, damaged, or destroyed company property like equipment, buildings, and inventory.
- Workers' compensation insurance: This can cover medical bills and partial wage replacement for workers who get injured or ill due to their job or work environment.
- Commercial auto insurance: This can cover costs associated with accidents, lawsuits, theft, and other incidents involving company vehicles.
- Cyber liability insurance: This can cover costs associated with data breaches and cyber-attacks that may expose, sell, or distribute private or sensitive data your business holds, such as customer credit card numbers.
- Business interruption insurance: This can continue paying necessary ongoing expenses and compensate for lost business income during temporary shutdowns due to covered causes like fire damage.
- Business owners policy (BOP) insurance: This convenient package of policies provides small businesses with the commercial property coverage, liability coverage, and loss of income coverage they need.
Work together with a local independent insurance agent to get your business set up with all the kinds of coverage it needs.
FAQs about Public Liability Insurance
Public liability insurance is a somewhat dated form of general liability insurance and provides similar coverage. General liability insurance also covers third-party claims against your business of personal property damage or bodily injuries but on a broader scale. Unless you have a very small business, you might want to get general liability insurance instead of public liability coverage.
Though not typically required by law, public liability insurance or general liability insurance may be required in certain instances. For example, certain clients may request a proof of liability insurance certificate from your business before they agree to work with you.
Typically, all businesses need some form of liability protection. However, most businesses would benefit more greatly from a general liability insurance policy rather than public liability insurance unless your company and budget are very small.
Independent insurance agents can help you get your business set up with the right kind of liability coverage. They're free to shop and compare policies and rates from many different carriers in your area. And down the road, your agent can help you file business insurance claims and update your policy as necessary.
https://www.thehartford.com/general-liability-insurance/public-liability-insurance