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Employee liability insurance vs. public liability insurance

Friday, 10 October 2014

Insurance is essential for safeguarding your business and liability insurance can be one of the best ways to protect yourself against compensation claims. But what are some of the key differences between employee and public liability insurance?

Who do they cover?

**Employee liability insurance refers to a business’s employees and ensures that in the event of an incident, compensation can be awarded without incurring a devastating cost to the business.

Public liability insurance refers to insurance that covers a business, in the event of an incident which affects a customer or visitor and they subsequently decide to claim for compensation.

What do they cover?

Injuries at work occur in all kinds of industries and sectors. For example an employee could be injured by a piece of machinery, hazardous chemicals or simply by slipping on a piece of loose flooring. Employers’ liability insurance helps you to pay compensation as well as legal fees, loss of earnings and other fees should you be proven to be at fault for an incident.

Public liability insurance covers you whether you are working in your own premises or that of a client. For example, you could be a carpet fitter who accidently smashes a valuable family antique or you could have injured a customer by not displaying correct wet floor signage.

Legal requirement

Employers are responsible for the welfare of their employees and as such it is a legal requirement to have insurance cover. If you fail to do so you could be charged up to £2,500 for each day you are without cover. There are exceptions to this rule, such as public bodies and family run business which are not limited companies. Public liability insurance isn’t a legal requirement but it is recommended if you want to safeguard your business against high cost compensation claims.

To find out more about liability insurance read our helpful guide here.

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