Public liability insurance protects your business if your negligence causes:

• Injury to another person
• Damage to third-party property
• Legal and compensation costs

It is essential for trades working on client sites or around the public.

Subcontractors can increase your liability exposure.

Even if they have their own insurance, you may still be held responsible as the principal contractor.

• Inform your insurer if you use subcontractors
• Keep subcontractors’ insurance details on file
• Review contracts carefully for liability obligations

Public Liability

Covers damage caused while performing work.

Product Liability

Covers damage caused by products or materials supplied or installed after the job is finished.

Claims can arise years later, so maintaining continuous cover is important.

Public liability generally does not cover:

• Tools and equipment
• Vehicles
• Employee injuries

Separate policies may be needed for:

• Tool insurance
• Commercial motor insurance
• Workers’ compensation

Incorrect or inadequate cover can leave your business exposed to major legal and financial costs.

Before starting a job, ask:

• Does my policy reflect the work I actually do?
• Am I covered for the products I install?
• Have I disclosed subcontractor use?
• Does my cover meet contract requirements?

Hi, everybody. Daniel here from Weber Insurance Services, and welcome to episode two of our mini series for tradie wives. Before we get started, I’d like to read through a brief disclaimer. Any information through here, this presentation is general in nature.

If you’d like personal advice, please reach out to any one of our friendly team. Today we’re going to talk about public liability insurance. Known by many different names, broad form liability, public and products liability, general liability, all essentially the same sort of thing. When we talk about public liability, we’re talking about loss or damage to third parties following your negligence, and typically that will be injury or damage to property, say, including injure to members of the pub public, damage to third party property, other incidents caused by your business, and obviously includes direct costs and the legal costs as well as potentially any consequential losses if you’re shutting down businesses and they’re losing revenue.

So why do you need it? Well, simply because all the time you’re working in other people’s premises or most of the time, anytime you’re doing that or anytime you’re interacting with other people that aren’t employed by your business, there’s the chance that you either injure them or damage their property. So when you’re dealing with other people’s houses, with other businesses, interacting with other people’s tools, equipment, machinery, and just any other interaction with people not employed by your business, there is the risk of a public liability claim. Subcontractors are really interesting when it comes to public liability insurance.

You probably find that your insurance company asks you, do you engage subcontractors?

And confusingly, they’re not doing this to cover the subcontractors necessarily, although some insurers can do that. They want to understand how much of your work is generated by revenue from employees versus subcontractors.

Going back to the slide before, we talked about injuries to third parties. Subcontractors are technically third parties to your business. So if a subcontractor is injured on your site, that may still be a public liability claim. On the other side, you may be vicariously liable for the actions of subcontractors if they cause damage, an injury.

You may get litigated if you’re the principal contractor.

So it’s important to remember that whilst your insurer will probably ask you about subcontractors, it’s not necessarily to cover them, it’s to understand how your business is exposed to various types of claims.

In a perfect world, each business is responsible for their own liability. However, in certain states, laws around proportionate liability mean that principal contractors can be liable for the actions of other contractors and you may be up for the costs and then it’s on to your legal representative or your insurer to recover the costs from others. I mentioned before some of the other names of public liability, public and products liability, general liability, broad form liability.

Most policies these days come as a package product between public liability and products liability.

Think about public liability being what you’re physically doing, the work you’re undertaking. If you’re an electrician, you might be running cables. If you’re a plumber, you might be digging trenches.

Losses or damage caused by your actions, that is your public liability.

Products liability is the products that you’re installing, that you’re supplying. So in that same example, if you’re an electrician running a cable, you leave the premises, the cable’s faulty, starts a fire, that’s a product liability claim. Similarly with a plumber, you install pipe, new fittings, fittings let go, floods the property, that’s gonna be more likely a a product liability claim. Even if you install the work now, you may still be up for product liability claims years into the future.

So it’s important to make sure that your insurance is up to date and current because product liability especially can happen many, many years after the actual work’s done. Some common misunderstandings with public liability insurance. So does it cover my tools or vehicle? Short answer is no, but you can have policies that combine your vehicle, your tools, and your public liability.

But generally speaking, your tools insurance and your motor vehicle insurance are separate. And does it cover your workers? Well, it covers the action of your workers. So if your employees cause damage to another person or damage their property, then, yes, that is likely covered under your policy. But if your employees are injured on-site, very different to your contractors. If your employees are injured on-site, then we’re talking workers’ compensation.

It’s really important to get your insurance right. It’s important to make sure that the coverage is suitable for your business because mistakes, having the wrong cover can cost you tens or hundreds of thousands of dollars.

Most contracts, particularly in the construction space, require you to have public liability, so it’s important that you have it to fulfill your contractual obligations.

It protects your business because without it, you’d be footing the legal bills, which in itself can run into tens or hundreds of thousands even if there’s no fault. It’s a minimum requirement for a lot of people in terms of reputation. So when you’re asked to go on-site, first thing they’ll ask is a copy of your public liability certificate.

And best of all, it’ll help you sleep at night. So before you next start your next job, just ask yourself, is your public liability right for the work that you’re doing? Am I covered for the products that I install? Is my scope of cover reflective of the work that you’re actually doing? Do you use subcontractors? And if you do, have you told your insurance company about it? And do the contracts I’m entering into have certain requirements or minimum amounts of coverage?

If you’re not sure, always reach out to your insurance provider. Thanks for joining us today for episode two. If you have any questions, please reach out on the email or the numbers below. Thanks a lot.