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A small business liability insurance policy can help protect you against the potential threat of claims being made against you in respect of your legal liability that you may be subjected to during the normal course of trade ; these claims might come from 3rd parties or from employees of the company.

Losses may arise on account of property damage, personal injuries or as a result of economic loss suffered by the claimant as a result of negligent guidance provided by the company.

The latter reason is the subject of professional indemnity insurance or professional liability insurance and it is not the objective of this short article to deal with these matters.

What liability insurance does a small business need?

The prudent business proprietor or operator needs to make sure that they are covered against losses from third parties in respect of their legal responsibility for property damage or personal injury that has arisen out of and in the course of the business. This really is the subject of third party liability cover.

A third party liability insurance policy offers the policyholder insurance against their legal liabilities for property damage and personal injuries, where this kind of loss is alleged to have been attributable to the policyholder during the course of the business.

It is essential to note that a significant aspect of the public liability insurance policy is the inclusion of defence costs incurred around the defence of the claim, whether the action be found to be the liability of the policyholder or not. The costs of mounting a legal defence could be great, even when compared with the cost of many claims, and it is an important insurance protection for policyholders that it’s included in the standard policy cover.

As third party liability cover is a contract of legal liability, the basic policy wording remains comparable from insurer to insurance company, however you’ll need to be aware of certain key features of the policy to make sure that the policy meets the requirements of your company;

What limit of indemnity should I have under my business liability insurance policy?

The Limit of Indemnity, this is the maximum amount of the insurance companies liability in respect of losses under the cover. This limit will be chosen by you but will depend often on contractual requirements placed upon you by your employers.

The business description under a small business liability insurance policy?

The Business Description, it is vital that this correctly represents your company activities as it is only claims that occur from your undertaking of this business description as well as the insurers reasonable understanding of the trade or business activity  which will be covered under the insurance.

Policy restrictions and endorsements, they are included with policies to delineate the insurers responsibility under the insurance for certain activities by perhaps limiting the kinds of work undertaken or by specifying the safeguards that should be taken when carrying out certain work.

As with all insurance contracts you need to read the document carefully to make sure that it meets with your requirements then you ought to raise any queries immediately with your insurance broker.

Do I need employers liability insurance for my business?

A business that employs people may be subject to losses from employees for injury or damage arising out of their employment. In the United Kingdom, this class of insurance is known as Employers Liability Insurance whereas it is known as Workers Compensation in the US and elsewhere.

Employers liability insurance is a legally required insurance requirement for all employers in the United Kingdom with a small number of exceptions that I cover elsewhere. The minimum limit of cover under an employers liability coverage is £5,000,000 while in practice contracts are generally issued with  a minimum limit of £10,000,000.

Is public liability insurance a legal requirement?

Whilst public liability insurance is not a legal requirement for the vast majority of businesses, it must be considered a vital must for all in business, the excellent news is that the cover is broadly available on the internet and at very competitive premiums.

Blackfriars can provide you with a range of highly competitive quotes from our panel of leading insurers and underwriters and are ideally placed to discuss your requirements with you via our highly experienced small business liability insurance team.