Public Liability for Tradies

Public Liability Insurance For TradesmenFor any self-employed tradie the key form of insurance required is public liability.

As a tradesman you are exposed to a range of risks every day, and one of the most serious risks is that you could injure someone or damage their property.

If you work for a builder on wages you will generally be covered by their policy, but if you work for yourself or as a subbie you’ll need your own policy.

Whether you’re a carpenter, electrician, welder or otherwise, public liability is one of the most important forms of insurance you can have.

More information

We’ve done a bit of digging around and managed to find some great information about this important form of insurance on a popular forum for tradesmen.

Some of the topics covered include tradesman public liability insurance as well as the age old question of what public liability actually covers.

Another popular thread we found was on faulty workmanship and whether or not it is covered under a public liability policy.

A word of warning…

Forums and websites can be great for gathering information from likeminded people who may be in a similar situation to yourself.

But of course anyone can post on a forum or blog without knowing what they’re talking about, so it’s important not to make any major decisions on your insurance based purely on a forum post.

By all means use the forums to get some initial information, but the best bet is to use an insurance broker who is qualified and licensed to give you proper advice.

The same goes for the publicliability.co website as well.  We do our best to provide businesses with information on public liability insurance, but at the end of the day we are just an information website and are not licensed to provide formal advice.

Pay by the Month Public Liability

Public Liability Insurance CostIf like many businesses your cashflow is being affected by the current state of the economy, paying your business insurance by the month could be a good option.

Depending on the size and type of your business, the cost of your insurance, and specifically your public liability cover, can be a large lump sum to come up with.

Whilst many direct insurance companies do not offer pay-by-the-month policies to business owners, there is a solution which comes in the form of premium funding.

Premium Funding

Premium funding is a way to pay your insurance monthly even when the insurance company does not offer a monthly option.

It works by the premium funding company paying the full premium on your behalf, and then you (or your business) repaying the premium to the funding company over a 12 month period.

Premium funding is available on virtually all forms of commercial insurance including public liability and similar covers.

Advantages

The main advantage of premium funding is that it allows you to spread your insurance costs over a longer period, therefore allowing you to better manage your cashflow across the year.

Even if the insurance company does not offer monthly payments (as is the case with many business insurance providers), premium funding will still enable you to pay monthly.

Disadvantages

As you are essentially borrowing the money for the premium from the premium funding company, it is only natural that the company will need to charge you an additional amount so that they can make money.

The premium funding companies do this by charging an interest rate on the premium amount.  In some cases they may also charge a small administration fee which is included in the first month’s payment.

Ultimately this means that paying your insurance monthly via premium funding is more expensive than simply paying the full amount upfront, but for many businesses the advantages outweigh the disadvantages.

More Information

For more information on paying your business insurance monthly please contact your insurance broker or adviser.

Public Liability Insurance Companies

Business Needing Public LiabilityHere in Australia there are at least a dozen insurance companies offering public liability insurance.

Many of the companies are household names such as Allianz, CGU, QBE and Vero.  Others are less well known, and often these are overseas based insurers.

As well as offering public liability, many of the insurers can offer other forms of insurance that are important to business owners.  Some of these covers include general property, theft, glass breakage and buildings.

Choosing an Insurance Company

When choosing an insurance company there are a number of factors that need to be taken into account.

Firstly you want an insurance company that you are going to feel comfortable with.  For many people this means dealing with an insurance company that they have heard of and that they believe has a good reputation.

For many business owners, especially in the current economic climate, it is important to save money wherever possible.  For this reason it is also important to choose an insurer which offers good value and competitive premiums.

It must also be remembered that not all insurance companies will cover all types of businesses.  If you operate a higher risk type of business you may find that only certain companies will offer you cover.

Choosing Public Liability Insurance

Choosing a public liability policy is an important decision for any business owner, as the consequences of having the wrong policy in the event of a big claim can be very serious.

You should choose a policy which is going to meet all of your business needs, and one of the best ways to do this is to use the services of an insurance broker who can analyse your business needs and recommend a suitable policy.

Whilst most public liability policies are very similar, each will have minor differences.  For example a CGU public liability insurance policy may offer slightly different cover to a Vero public liability policy.

For more information on choosing a company for your insurance needs we recommend speaking to a licensed and qualified insurance broker.

Tradesman Public Liability Insurance

Public Liability Insurance For TradesmenAll sorts of businesses around Australia require public liability insurance, but one sector for which public liability is a must is the trades and construction industry.

For most businesses public liability cover can be considered a must, but it is not actually mandatory.  It’s a different story for tradesmen though, with many having mandatory public liability requirements in place.

What is Tradesman Public Liability?

Generally speaking, tradesman public liability insurance is no different to public liability for any other business, however there are some special requirements when it comes to tradies.

Some tradesmen, such as electricians and plumbers in certain states, have special requirements for their public liability cover which can only be met by certain insurance companies.

For example electrical contractors in Queensland have a special requirement that their public liability cover must include no less than $50,000 in consumer protection insurance.  This is not a standard option for public liability, and only some insurance companies offer it.

Overall public liability for tradesmen is similar to the cover for other businesses, in that it covers property damage or personal injury caused as a result of the business activities.

How Much Does It Cost?

The cost for public liability insurance for tradesmen is actually quite cheap compared to many other types of business, but it does depend on the type of trade to be covered.

Some tradesmen who work in standard trades, mainly on residential and light commercial projects, will generally find that they can obtain basic cover for less than $500 per year.

The cost of public liability insurance can vary dramatically for some trades however.  For example a boilermaker or scaffolder can expect to pay far more for their insurance compared to a carpenter or electrician.

Taking Out Trade Public Liability Insurance

Before you go ahead with a public liability policy you will want to get a number of quotes from the various public liability insurance companies offering cover here in Australia.

You can approach each insurance company separately seeking quote on your liability cover, or you can use an insurance broker who can obtain multiple insurance quotes for you at once.

Once you are happy with a quote, you can either take out cover directly through the insurance company, or your broker can take care of the process for you.

Public liability insurance is vital for any self-employed tradesman.  For more information you should speak with your tradesman insurance broker or other insurance specialist.

Using an Insurance Broker

Business Needing Public LiabilityOne of the most popular ways for Australian businesses to take out public liability insurance is via an insurance broker.

There are many types of insurance which you can take out directly from the insurer via a call centre or website, such as car or home insurance, but when it comes to public liability it is best to speak with a specialist.

Benefits of Using a Public Liability Broker

There are plenty of reasons why you should use a public liability insurance broker for your business insurance needs.

A qualified broker who understands your business and industry will be best placed to recommend the insurance companies and policies which best meet your needs.

You could choose your insurance yourself, but public liability is a complex form of insurance, and most business owners agree that is better to use a professional rather than risking it yourself.

An insurance broker will be able to analyse the needs of your business and made recommendations on what type of cover you need, how much cover you need and which insurance companies will provide you and your business with the best value.

Broker or Direct?

In the past it was only possible to obtain public liability insurance via a broker, however more insurers are now offering this form of insurance direct to business owners.

Going direct to the insurance companies may work well for some businesses, and in some cases it may even result in lower premiums.  If you run a very simple business, this could be a good option.

The problem with going direct however is that the insurance companies will generally not provide you with personal advice or recommendations.  They can give you the facts, but they cannot tell you whether or not a particular policy is right for your specific situation.

This is where an insurance broker comes into play.  Brokers are licensed to provide you with personal advice, so they can tell you if a certain policy will meet your specific needs.  They can also use their own knowledge and experience to ensure you are properly protected.

Insurance Broker Quotes

Any insurance broker will be able to provide you with a quote on your public liability cover.  They will also be able to answer your questions, such as what is public liability insurance?

There is nothing stopping you from bypassing an insurance broker and going direct to an insurance company, however most business owners would agree that the small additional cost of using a broker is worth it.

Using a broker may even save you money, as they know which insurance companies and policies will offer the best value for your particular industry.  With this being the case, even with an extra broker fee they may still get you a cheaper policy than you could have found yourself.

What Is Public Liability Insurance?

Business Needing Public LiabilityPublic liability is a special form of insurance which is designed to protect business owners from the financial fallout that comes when things go wrong.

As a business owner there are dozens of different risks that you face every day.  One of the biggest risks is that your business causes property damage or personal injury to a customer or member of the public.

What does public liability cover?

Your public liability insurance policy will cover you for the financial costs of a claim which involves personal injury or property damage to another person.

It is important to remember that public liability does not cover personal injury to yourself or your staff, or damage to you or your staff’s property.

The best way to understand what is public liability insurance is to look at some examples of common claims.

Claims – Property Damage

There are many ways in which your business activities can result in damage to someone else’s property.

Damage which is generally covered by a public liability insurance policy includes damage which you cause directly, such as knocking over a valuable vase whilst working in someone’s house.

There can also be damage which occurs at a later date.  For example you may have installed an electrical switch in a home, then two weeks later the house could be damaged due to you installing the wiring incorrectly.

Claims – Personal Injury

Personal injury claims are often the most financially damaging when it comes to public liability.

Common public liability claims for business owners can include a customer or visitor tripping and falling whilst on your business premises, where it can be shown that the fall was due to the actions (or inaction) of your business.

How much does public liability cover?

Public liability policies are available in a range of sizes.  Here in Australia you can generally obtain a policy in the following sizes:

  • $5,000,000
  • $10,000,000
  • $20,000,000

Some insurers also issue policies of $15 million, however those listed above are the most common.

In special circumstances it is possible to obtain a public liability insurance policy for a larger amount, however this is generally not required for most businesses unless they are doing something out of the ordinary.

More information on public liability insurance

If you require more information on this form of insurance or would like to obtain a public liability quote please speak with your insurance broker or any other suitably qualified insurance professional.

Public Liability Insurance Cost

Public Liability Insurance CostAlthough many small business owners understand the need for public liability insurance, very few understand how the pricing of the premiums works.

Like most forms of insurance, the premiums for public liability are predominantly based on the perceived risk that your business poses to the insurance company.

Put simply, if they think you are a high risk you will pay higher premiums, and if they think you are a lower risk you will pay lower premiums.

Although the public liability insurance cost for each business is based on a range of different factors, there are a core group of factors which have a major impact on premiums.

Business Activities

Your business activities will arguably have the largest impact on your public liability insurance cost.

This factor all comes down to risk.  If you operate a high risk business such as a skydiving school you can expect to pay a lot more than an accountant two works out of a small suburban office.

It is important to be open and upfront with the insurance company and your insurance broker, as if you fail to disclose any of your business activities you may find that a claim on your policy could be declined.

Business Size

The size of your business will also have a major impact on your public liability cost.

Some insurance companies measure size by the number of employees, whilst other measure by the size of your revenue.  Some insurers now use a combination of both factors.

As your would expect, companies with larger staff number or revenue will pay higher premiums for their public liability when compared to smaller companies.

Sum Insured

Public liability insurance is available in three main sizes, being $5 million, $10 million and $20 million.  Some insurers offer different figures, but these are the most commonly used options.

The amount of cover you require will have a direct impact on the insurance premium, however the size of the policy is not directly linked to the sum insured.

For example a $20 million policy will cost more than a $10 million policy, however it won’t cost you twice and much in premiums for twice as much cover.

Other Factors

Whilst the factors listed above are considered to have the biggest impact on public liability insurance costs for businesses, there are a number of other factors which will often be taken into account.

These can include factors such as whether or not your business uses subcontractors or labour hire, whether or not you work in any hazardous locations and the size of any large projects that you work on.

The most important thing is to tell the insurance company all relevant information about your business.

There is no point withholding information or even lying in order to reduce your public liability insurance cost, as it will more than likely just end up in a declined claim.

What’s Your Cost?

The best way to find out what your public liability cost will be is to contact a suitable insurance broker.

An insurance broker will be able to obtain quotes from a range of insurance companies so that you can compare the costs as well as the features of each policy.

Insurance for Entrepreneurs

startup.com movieStarting a new business can be a fantastic experience, but along with the highs there are plenty of lows.

As an entrepreneur it is easy to get caught up in the excitement of your new venture.  In terms of concerns, really you are more worried about building up clients and revenue more than anything else.

Concerns for Business

Depending on the type of business you are starting, there are some pretty serious risks that you’ll face as an entrepreneur and business owner.

If you’re starting an online service business such as the guy depicted in the movie Startup.com (pictured) then you probably don’t have to worry about property damage or person injury (maybe just a few bruised egos!).

But if you run a business which is selling products (online or offline) or have members of the public coming into your office or workplace, then there are some definite concerns.

Whilst you’re busy worrying about building your business, what happens if one of your products results in damage to someone else property or personal injury?  What if someone hurts themselves at your workplace?

No matter how good your business model is, if one of these people sue you for negligence your business could be sent bankrupt before you’ve even had a chance to prove yourself.

Protect Yourself and Your Business

One way to protect yourself is just to be really careful, but this is a flawed strategy as it is far from fool proof.

The best option is to cover yourself with some business insurance.

I can hear all of the entrepreneurs already – who wants to spend money on insurance that can be better spent on marketing and product development?

Well if something goes wrong and you don’t have insurance, then you won’t have a business to market or any products to develop!

Most new businesses will benefit from holding public liability insurance, and the good news is that this cover is quite cheap for most businesses, especially if you are office based rather than involved in manual work.

There are plenty of other forms of insurance which may or may not be suitable for you depending on the type and size of business that you run.

For more information on public liability and other forms of insurance please speak with your insurance broker.  If you don’t already have a broker, then you should get one as soon as possible!

Public Liability Quotes

Public Liability QuotesOnce you have made the decision to take out a public liability insurance policy for your business or organisation, the next step is to obtain quotes.

Obtaining quotes is an important part of the public liability process, as you need to budget for the cost of the insurance, as well as compare various quotes to ensure you are getting the best value for money.

Do it properly

There is no point in looking for public liability quotes if you don’t know exactly what cover you need for your business.

You could of course just take out the cheapest public liability insurance policy you can find, but if the policy is not suitable for your business then you are just wasting your money anyway.

So before you start looking for quotes, you first need to do you research and find out which type of public liability policy is going to suit your needs best.

If you are unsure of which type of policy you should choose, it is recommended that you speak with an insurance broker.  In most cases the broker can also obtain the quotes for you if wish.

Obtaining quotes

There are a few different ways in which you can obtain quotes on your public liability cover.

Many business owners and operators obtain quotes from a qualified insurance broker.  This is certainly a good option, as you can rely on the expertise of the broker to help you choose the right policy.

The only downside to using a broker is that they will generally charge you an additional fee for their service, but many business owners find this fee worthwhile due to the service and advice that they receive.

For business owners who are comfortable in researching and choosing their cover themselves, another option for obtaining quotes is to go online.

There are various websites which provide quotes for public liability insurance.  Some are owned by the insurance companies, whilst some are owned by independent groups.

Going ahead

Once you have gathered all of your public liability quotes the next step is to proceed with the cover and get your business protected.

The good news is that however you get your quotes, the same method will be available to proceed with the insurance if you wish.

Insurance brokers can help you through the application and proposal process, and many of the websites offering quotes also have online application systems available.

For more information or to obtain quotes on your public liability insurance please contact your broker or insurance professional.

Public Liability Insurance

Business Needing Public LiabilityBusinesses and organisations around the world rely on public liability insurance to protect themselves from unforeseen events.

All business large and small can benefit from public liability cover, as can other not-for-profit and charity organisations.

What is Public Liability?

No matter what type of business you run, there is always the risk that your business activities could result in property damage or personal injury to a customer or member of the general public.

If your business activities are proven to be the cause, regardless of whether it was due to negligence or an accident, you will be liable for the financial damages.

Public liability insurance covers you for these costs instead of having to come out of your own pocket.

Claims for public liability insurance can range anywhere from a few hundred dollars to a few million dollars, and some claims would send a business broke if they didn’t have insurance.

How much does it cost?

The public liability insurance cost will vary for each organisation depending on a wide range of factors.

The cost is generally based on the perceived risk that your business poses.  If you run a business which involves a lot of manual work you will likely pay more than a business which does more office based work.

Likewise if you have a large number of staff or a large turnover, you can expect to pay higher public liability premiums that a smaller company in the same industry.

The amount of cover you require will also impact upon your premium.  Public liability policies are generally available in amounts of $5, $10 and $20 million, and the more cover you have the more expensive the premiums will be.

Taking out a policy

If you are considering public liability cover for your business, the first person you should speak with is your insurance broker.

For business owners who do not already have an insurance broker, you can go directly to some insurance companies to obtain quotes and coverage, however it may be better to contact an insurance broker and build a business relationship with them.