As a contractor, you have a lot to think about – after all, you don’t have the luxury of having an employer organising everything for you. This also goes for insurance. It’s essential that you protect your risks by having the right insurance package in place. When it comes to insurance for contactors, public liability insurance is one of the most important forms of cover. Today, we’ll be taking a closer look at everything you need to know about public liability insurance.
Public liability insurance is designed to protect you financially if you cause injury to a third party or damage to third party property as the result of your actions at work. Public Liability insurance also covers legal bills if you need to hire a lawyer during the claims process. If a public liability claim is successful, this could amount to thousands, or even hundreds of thousands, of dollars which is why liability cover is so important. Just some of the costs that you could be liable for include medical bills, rehabilitation costs, repairs and replacement and the last thing you need is to have to use your own money.
There is no legal requirement in Australia for you to have public liability insurance. However, for some contractors there are regulations in your industry related to public liability insurance and in some cases you won’t be able to carry out your work without proof of cover. In other situations, employers and clients won’t be willing to take you on unless you can provide evidence of public liability insurance. Even if you don’t have a professional obligation to have public liability insurance in place, it’s important to remember that accidents happen and you need to be prepared. All it would take is for someone to trip over in your office or for damage to a third party vehicle to occur while onsite for you to find yourself on the receiving end of a claim public liability insurance provides ongoing peace of mind.
There are a number of factors which can contribute to the cost of your public liability insurance, including the type of work you do, the location of your work, the size of your business and the number of employees that you have. The riskier your work, the higher your premiums as there’s an increased risk of things going wrong. For example, if you have a fairly large business with a number of employees then you can also expect to pay more in liability insurance premiums as you will need to cover your employees and there is a higher chance of larger businesses making a claim. The other factor that will contribute to the cost of your public liability Insurance is the amount you want to be insured for. The higher the amount you’re being insured for, the higher your premiums.
There are three main levels of cover with public liability insurance - $5 million, $10 million and $20 million. When you’re choosing your level of cover, it’s important to consider the specific risks associated with your work. Think about worst case scenario – what’s the most expensive thing that could go wrong? The more risks associated with your business, the more coverage you’ll need.
If you run a small business and have no employees, you might be safe having $5 million in cover as you can generally be confident that no damages would exceed this amount. However, if you’re a larger business doing risker jobs or have a number of employees, you may want to opt for a higher amount. When it comes to choosing your level of cover, also make sure you check your contract if you’re taking on new work. In some cases, the contract will specific how much liability insurance they want you to have in place. Remember that the level of cover you require may change over time so don’t just keep your current level of cover without reviewing it. Let your insurer know if there are changes to your circumstances, such as hiring new employees, as you may need to up your cover.
The most important thing is to ensure that you’re not underinsured as this means you could be caught out in the event of a claim. Speak to your insurance broker and they can take a look at your situation to make sure you have the right level of liability insurance in place.
Although public liability insurance is designed to protect you, it won’t cover everything. Make sure you read the exclusions attached to your policy so you know what situations won’t be covered. While the exclusions will vary depending on the policy, there are a number of exclusions which tend to be consistent across most policies. Your public liability insurance covers third parties only – it won’t cover injury or damage which occurs to you or your employees. It also won’t cover illegal or deliberate behaviour or additional taxes, fines and punitive damages attached to a claim. Additional exclusions often include claims related to asbestos and pollution.
At Contractor Cover, we work hard to make the process of buying insurance as easy as possible. We understand that unique needs of contractors and we’ve bundled together the most commonly used policies for contractors into one convenient package. This means that you don’t need to mess around with multiple policies for easy to understand coverage. With our help, you’ll save both time and money with your insurance.
For public liability insurance Australia, contact Contractor Cover today on 1300 438 268. You can also jump on our website for an easy public liability insurance online quote.