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What happens if you have no Public Liability Insurance?

Rhino Trade Insurance 10 February 2023

What happens if you don’t have Public Liability Insurance?

Public Liability Insurance isn’t a legal requirement. Nobody is going to come and corner you in the street and force you to protect your business against financial loss. 

But then you won’t find any laws preventing you from washing your car with a scouring pad either. 

Free will is a wonderful thing, but when you’re running your own small business, it helps to have a good dose of common sense too. This is where Public Liability Insurance comes in.

 

What is Public Liability Insurance?

First, what is it? Public Liability Insurance is a type of cover that business owners take out to protect themselves in the event that a customer or member of the public brings a claim against them for injury, illness or property damage incurred as a result of their business activities. 

Anything from a sprained ankle to accidental death comes under the umbrella of Public Liability Insurance. It also covers damage to the possessions and property of the public, be it a water-damaged laptop or a house accidentally destroyed by fire.

Public Liability Insurance is like a shield around you financially should someone take legal action against you for property damage or injury. It protects the interests of both the public and your clients and applies at your premises and elsewhere, too. 

 

Who has Public Liability Insurance?

Every single big business has robust Public Liability Insurance policy in place to cover them against claims from the public. The risk of getting hit with a compensation claim or being sued is simply too great a risk, especially when they can run into the millions of pounds.

Most small businesses also have Public Liability cover in place, but there are a few who (wrongly) believe that chances of a claim are low, and they’d rather deal with claims as and when they happen.

This is a disastrous approach which has seen small businesses go under thanks to a single claim. Paying out-of-pocket for Public Liability claims is a sure-fire way to bankrupt a small business. And if the claim is major – think grievous injury or even death – the costs will far outstrip what your business has in its coffers.

 

Why is Public Liability Insurance so important for tradespeople?

Tradespeople tend to be self-employed, which means they aren’t protected under anyone else’s PL policy. They must organise their own business insurance and take the full financial hit for any area where they’re not covered (for instance tool theft or legal claims). 

Also, tradespeople come with hazards and risk as part of the job. Whether it’s chemicals, machinery, tools or working at height, your average man or woman working in the trades surrounds themselves with danger on a daily basis. 

All this risk means you’re more likely to accidentally cause harm, damage or injury to people and items around you than someone who barely leaves their office chair all day.

One more thing – many clients won’t work with a tradesperson who doesn’t have Public Liability Insurance in place. Why? Because they know that it’s not worth the risk, as a claim could capsize your business meaning you’d be unable to finish the job for them.

 

What If I don't have Public Liability Insurance?

This is the million dollar question.

At first, nothing might happen. You carry on your job as before, just without the invisible safety net that those with Public Liability Insurance in place have.

But then the day comes that your apprentice leaves a tripping hazard in place on the job, causing a client to fall down the stairs and break their leg. Or you reverse your work van over their neighbour’s priceless 800-year old Bonsai tree. Let’s say you’re really unlucky, and both of these things happen in the same day. 

Unsurprisingly, the first thing both the injured client and the tree owner will do is lodge a claim against your business. They’ll both be looking for hefty pay outs – whether in medical bills, compensation for time off work or damages to replace the tree (seriously – those things aren’t cheap). 

If you’re uninsured, you’ll find yourself without the financial safety net that Public Liability Insurance provides. 

Your business will soon be on the hook for £350,000 in total costs. Without Public Liability Insurance you can’t pay – so your business goes under.

Now consider this same scenario if you had Public Liability Insurance. You’re not going to be delighted about causing harm to anyone of course, but after a call to your insurer, you can relax knowing that the inevitable costs will be borne by your insurer and your bottom line won’t be affected.

At Rhino Trade Insurance, we offer Public Liability cover of up to £5million with higher values possible upon request. Now that’s some serious peace of mind.

 

Why do I need Public Liability Insurance?

We hope the above example has given you a good idea of why you, as a self-employed tradesperson, need Public Liability Insurance in place.

Simply put, having Public Liability Insurance provides the essential cover you may one day need to save your business from going bankrupt. Accidents can happen at any moment in the workplace. As tradespeople working in high-risk locations, using high-risk tools, or performing high-risk jobs, the need for this type of insurance cannot be understated. 

Public Liability Insurance provides the vital cover needed if you are required to pay compensation due to a claim. 

 

What happens if you have no Public Liability Insurance?

Having no Public Liability Insurance in place is a risk simply not worth taking. Working under the assumption that you would handle any pay outs resulting from a claim as and when they arise is a false economy and not recommended for any business owner.

True, many Public Liability Insurance claims are relatively low. Still, claims can end up costing tens or hundreds of thousands – which no small business has to spare. It’s not unheard of for a complicated claim to cost millions – a disaster for any uninsured business. 

Having the right insurance in place can be the difference between a stable business and bankruptcy. If you have no Public Liability Insurance in place and you must pay out in the event of a claim will mean that all compensation comes out of your business' bank account and directly from your bottom line. 

Having insurance in place gives you financial protection in the event of an accident happening. It offers you peace of mind in the knowledge that if something did go wrong, you would still be covered.

 

Is Public Liability Insurance a legal requirement?

Public Liability Insurance is not legally required here in the UK, but that doesn't mean it's not vital to ensure that your business operates successfully and compliantly. 

So, Public Liability Cover is not compulsory, unlike other insurance policies (motor insurance and buildings insurance, for example). But by not having it in place, you will not be subject to any legal action made against you, so it’s an important commodity for any small business. 

Why choose Rhino Trade Insurance for your Public Liability Cover?

Rhino Trade Insurance are the experts in tailored insurance policies for tradespeople working in the UK. 

Our Public Liability Insurance will cover you for multiple situations where you may be found liable.

Here’s a quick breakdown of what we offer:

  • £1M, £2M, and £5M levels of cover available
  • Option to add Employers' Liability cover
  • Starts at just £6.07 per month
  • Optional cover for multiple trades/business activities
  • Instant cover with documents immediately
  • Monthly or annual payment options
  • UK telephone support

 

Switch your Public Liability Insurance now

Switching insurance providers could not be easier. You could simply cancel your current liability insurance policy and take out a policy with Rhino.

Alternately, you could wait until your renewal date with your current provider and do it then. In both cases, we here at Rhino would ensure a seamless transition and ensure that you have no gap in cover. 

If you have only just recently taken out liability insurance and want to switch to Rhino, note that all insurance policies have a 14-day cooling-off period where you can cancel unpenalized, so if you’re within that window then switching to Rhino maybe even more straightforward than you think.

If you want to switch to Rhino Trade Insurance, then you can do so today. Just give our team a call on 01162437904 or get it yourself online with us – it just takes a few minutes.


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