3rd Party Liability Insurance

What Does 3rd Party Liability Protection Do For You?

For many people who run small businesses it can be difficult to understand what insurances you need to have in place. Some policies are legally required under the law, but no business wants to spend money they do not need to, so it is important to understand what cover you must have and what is optional. Similarly, you need to know what each type of commercial insurance actually does for you, so that you can make a judgement about whether it is a necessary expense for your business.

This article is mainly about third party liability insurance, which is also referred to as public liability protection. The first thing you need to know is that there is no law that says you must have this in place, unless you fall into one of a very few industries that are required to hold it. The main area where this is compulsory is where the business offers horse riding to the public, as this is a high risk service. For anyone else you have to make the decision about whether it makes sense for your business to take out a policy or not.

You will no doubt want to know what types of business need these policies and whether it is a good idea for your business to hold 3rd party liability cover. The answer is that in reality there are very few businesses where you can say this type of protection is definitely not necessary. If you are a self employed person who works and home, does not employ anyone else and never visits or meets a client, then you are probably OK without it. For everyone else, it probably makes sense to have something in place. It is often bought in conjunction with PI insurance, which is professional indemnity protection.

What third party liability cover does is protect you from claims by any third party. It is also known as third party liability cover. These claims could be for personal injury or damages to property or belongings. Whatever your line of business, there are countless ways in which people may have an accident and be injured, or where something happens to cause damage to another person’s property.

The kind of scenarios that are most common are when someone visits your place of work and has some sort of slip, trip or fall, resulting in an injury. The other most obvious cause is when you or your staff have to go to other premises to carry out work and damage or injury is caused to someone or some thing due to the work you are doing. This can include things like leaving an item of equipment on the ground and someone falling over it, or damaging a fixture or fitting while moving equipment around a house or other property.

Many of these things can at first appear to be just accidents, with no-one really to blame, but in this increasingly litigious society in which we live, there is no such thing as an accident without blame. If someone trips over a loose carpet tile on your floor, you can be sued for not taking care to provide a safe environment for your customers. Simple accidents can often lead to quite complicated and prolonged injuries, such as back or neck problems, and these can be very expensive when it comes to claims. A significant claim with substantial legal costs could hit your business very hard if you are not prepared for it. The advantage of 3rd party liability insurance is that it pays out for exactly this sort of unexpected cost.

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