How much public liability insurance do I need?
Public liability insurance covers business owners if a third party sues them. It’ll cover the legal fees along with other costs such as compensation fees if a person is injured or dies and makes a claim against them.
Understand public liability cover and how it can protect your business
Confused about public liability insurance? It’s a crucial form of business insurance that protects your bottom line against third-party claims. Read our guide to find out more.

Public Liability Insurance Explained
Public liability covers you if a claim is made against you by a member of the public in relation to your business activities. These claims can come from customers, clients, and contractors as well as other third parties, and your insurance will cover claims for injury, illness, damage to property, and death.
How does it work?
Public liability insurance is a popular type of commercial cover and it can be tailored to your own unique requirements. There are many policies to choose from so it’s important to buy one that suits your business.
When you buy a policy, you’ll be able to set the cover level you require and the insurer will price your policy based on lots of different factors, including the nature and location of your business, and the amount of cover you’re looking for.
Then, if a claim is made against you by a third party, you can use the insurance to cover your costs instead of paying them yourself.
What’s covered by public liability insurance?
While every policy is different, here are a few examples of what’s usually covered, and not covered.
What’s covered?
Public liability insurance usually includes the following scenarios, either if they happen at your business or if you’re at another location, such as an event, which has been planned and organised by your company:
The cost for compensation if someone is injured
The cost of loss or damage to someone else’s property
The cost of compensation if someone dies
It also covers anyone who you are interacting with as part of your businesses, including customers, clients, and anyone taking part in or watching an event or activity you have planned.
What’s not covered?
The following are usually not covered with public liability insurance:
Anyone you employ will not be covered; you’ll need employers’ liability insurance to protect them
Temporary staff, students, or anyone on a work placement will also be excluded from this type of cover
Our expert says
While it’s all too easy to dismiss its importance, if you deal with members of the public while carrying out your business then you should probably get public liability insurance. A claim against you could be financially ruinous - even if it’s not your fault - and good cover will mean your bottom line is protected.
What expenses and costs does public liability insurance cover?
Public liability insurance will cover your extra costs if your business is sued by a member of the public – and there are many potential costs involved.
There are legal fees to start with but also there may be compensation to pay. This can include claims to repair or replace someone’s property, claims for medical bills or lost income, and even compensation for pain and suffering.
Does public liability insurance cover legal fees?
You’ll be covered for legal fees and it’s possible the court will order you to pay the other side’s legal fees too which your insurance will also cover.
Because these claims can run into the hundreds of thousands or even millions of pounds, a good public liability insurance policy should cover you for at least £1 million. This might seem like a lot, but it’s important to not be under-insured – if your insurance doesn’t meet your costs, you’ll have to pay the difference yourself. That’s why it’s crucial to pick the right level of cover.
Does public liability cover loss of income?
You could be sued if someone has lost their income, such as if you run a shop and a customer trips and falls over some stock that’s been left on the floor. If they break a bone, they could be out of work for weeks, and even sue you for the lost income – but public liability will pay for any damages.
Does my business need public liability insurance?
You may need cover if your business brings you into contact with other people who aren’t your direct employees, and we have a complete guide to who needs public liability insurance to help you decide.
Any kind of business might need public liability insurance. Here are a few scenarios where this type of cover can be useful:
If you own a physical premises where you receive customers, such as shops, restaurants, cafés, hairdressers, pubs, and venues.
If you do your work in other people’s properties – for instance, you could be a plumber or electrician
If your business is based in an office, factory, or workshop, public liability could be crucial if you ever have clients, contractors or customers visiting you.
If you’re a contractor, your clients might insist you’re fully insured before they’ll agree to work with you. Plenty of trade associations also have minimum levels of public liability cover for all their members.
Is public liability insurance a legal requirement?
Public liability insurance is not a legal requirement, yet it’s an important policy to have and can save you a lot of money if you do end up in court. Getting insured could also open up your business to more clients and allow you to join trade societies.
What happens if I don't have public liability insurance?
Without public liability insurance, you run the risk of losing serious amounts of money. If someone files a claim against you and you don’t have it, you’ll have to pay for a solicitor out of the company funds or even your own pocket.
How much public liability cover do I need?
You choose the amount of public liability insurance you need when you buy a new policy. When getting a quote through us, you'll have the option of £1 million, £2 million, £5 million, or £10 million.
The price of your premiums will be more if you choose more cover, but it’s important to make sure you have enough cover if a claim were to be made against you. Our guide to finding the right level of public liability insurance can help you decide how much cover your company needs.