Do I need public liability insurance?
Not all businesses need public liability cover – but if your work brings you in contact with the public, yours might. Read our guide to see if public liability is necessary for you.
Find out who needs public liability insurance
Public liability insurance is one of the main kinds of commercial cover – it’s there to protect your bottom line against the risks that come with dealing with members of the public. But since every business is different, they all have different needs. You can tailor your insurance to your own unique requirements: that way, you won’t risk massive losses by being under-insured, but you also won’t be wasting money on cover you don’t really need.

Do I need public liability insurance?
Public liability insurance is not a legal requirement, but many business owners buy it in case a third party makes a claim against them. You may need it if you work in the following areas:
If you own a business such as a shop, restaurant, or hair salon, you’ll be interacting with people on a daily basis and public liability insurance covers you if someone were to sue you.
In some cases, business clients might ask for you to have this type of cover, such as if you’re hosting an event like a wedding or a birthday party at a different venue. The insurance will cover anyone attending or watching the event, in case they are injured or in the worst case, if someone dies.
If you work in a public area, such as a tradesperson, and a member of the public could be injured if they are nearby.
Is public liability insurance required by law?
No, public liability insurance isn’t mandatory. The law says that you must have employers’ liability insurance if you have any employees that aren’t directly related to you – whether or not you get public liability is up to you.
When is public liability insurance required?
There are some situations in which you might be required to have to have public liability insurance in place before you can get to work. If you’re a contractor, your clients might insist on a certain level of public liability insurance before they’ll work with you. Similarly, some trade associations require their members to be fully insured.
For instance, if you want to join the Association of Plumbing and Heating Contractors, you need to have at least £2 million in public liability cover. Belonging to the relevant trade association is an important way of letting your clients and customers know that your business is reliable – so it pays to get insured.
Public liability insurance covers you against any claims made by members of the public against your business, which can easily run into the millions. No matter how hard you try to minimise risk, accidents can always happen – so if your business involves any kind of contact with other people, public liability is worth considering.
What could a public liability policy help with?
No matter what kind of business you run, it’s likely that there are some possible situations where public liability could help. Here are a few examples:
If you run a shop and a customer slips over and breaks their wrist, they may have to stop working until they are better but public liability will pay for any damages
If you have an office where you might meet clients the same risks could apply – and it works the other way too. If you meet clients at their own business premises, there’s still the risk of causing damage – it only takes one spilt cup of coffee to ruin a new computer
If you’re in the building trade there’s always some risk to members of the public. An electrician could accidentally cut off the power to a neighbouring property, spoiling the food in their freezer, or a piece of scaffolding could fall from a building site and injure a passer-by
Even if you’re simply trying to promote a business in public, there are risks you might need public liability to protect you from. Someone handing out leaflets could trample over a flowerbed, or a sign at a trade show might collapse and injure someone.
What types of businesses need public liability?
Public liability insurance can help just about any kind of business – if your work involves physically interacting with other people, it’s worth getting insured. Here are just a few of the types of businesses that find public liability helpful:
Retailers
Restaurants and cafés
Manufacturers
Licensed traders or market stall holders
Event organisers, such as festivals or weddings
Contractors or tradespeople
Do I need public liability insurance as a sole trader?
Even if you have a small business, you still might need public liability insurance – and for an uninsured sole trader, the costs could be crippling if a member of the public chooses to sue.
That’s why it’s important for sole traders or self-employed workers to get the right level of protection if you have any contact with the public, including customers and clients. Sole traders with smaller turnovers can usually get a much cheaper deal on public liability insurance than big firms too.
Do I need public liability insurance for a wedding or private party?
If your business is hosting a private function on your business premises, then public liability is a must. If you’re hiring out a venue, it’s also encouraged. In fact, many venues might require any clients to have the right level of insurance in place before they’ll let you use their space.
If you’re an event planner or you manage private parties as part of your business, then public liability is one of the most crucial kinds of business cover out there for you. When you plan a wedding or event, you could be legally liable for anything that goes wrong – and with plenty of excited guests, you can never rule out risks entirely. Make sure you’re properly insured, so if a settlement claim comes up, it’s your insurer that pays out, and not you.
Do I need public liability insurance if I work from home?
Even if you work from home, it might be a good idea to get public liability insurance. There’s a simple test to work out if you need this cover – does anyone ever visit you at home for business purposes, or does your work ever take you outside the house? If the answer to either question is yes, then you should seriously consider public liability.
What happens if I don’t have public liability insurance?
If someone files a claim against you and you don’t have public liability, you’ll have to pay for a solicitor out of the company funds or even your own pocket – and solicitors’ fees can run into the thousands per day.
It’s easy for a single case to completely bankrupt a small business. But with public liability, your insurer will cover everything – from the cost of hiring lawyers to any compensation pay-outs. All you’ll have to pay towards any claim is a small excess, and once the process has been finished, you can go back to doing what you do best – without risking your business’s future.