How Much Public Liability Cover Do I Need?

If you are just starting out with a business, and have never encountered a lawsuit, you may not know what public liability insurance is or why it is so important. Perhaps you think it is just a good idea to get something to protect your assets. You should consider the following before you decide. First, do you have any insurance coverage for these situations? Second, can you afford not to have this protection?

One reason to have public liability policy coverage is to protect you against lawsuits that occur while you are working on or near a construction site. Even if you conduct your business quietly, things can still go very wrong accidentally. A delivery van strikes a pedestrian on the way to the store. A defective product spills in someone’s hand on the factory floor, causing damage.

Public Liability Insurance also covers claims made by customers who suffer injuries while on your property. For example, if you were operating your concession stand in a wooded area and a customer slips and falls, you may be liable for any medical bills or property damage he or she sustains. PLI coverage even covers claims made by employees in the workplace, as long as they are acting in accordance with company policy. Employees who are hurt while making a normal workday will not likely have much protection under PLI, because workers cannot usually sue their employer for punitive damages. In addition, PLI does not cover traffic-related injuries, like falling in a construction zone.

What about legal expenses and judgments? When someone gets hurt because of your company’s negligence, you could be forced to pay medical expenses and other court costs related to the incident. PLI will not cover expenses that arise from an “accidental” injury, and it does not cover any damages that result from the negligence of your employees. If you have sued your employer for wrongful termination or other employment-related issues, PLI will not help you.

What does a PLI coverage benefit you? Perhaps the most obvious benefit is that it will cover legal expenses you might incur in the course of defending a claim. If you are on the wrong end of a slip-and-fall accident and injured or hurt, your PLI benefit will help you collect on your medical bills. If you are injured in a workplace due to negligence, a PLI claim will protect you from a wage garnishment or other retribution the company can legally inflict.

How can you get PLI? In most states, PLI is a mandatory element of your general liability coverage. Mark from says that as a general rule, your employer must purchase this coverage to ensure that you receive full benefits in case you are injured or harmed in the workplace. Even if your state does not require a specific public liability policy, your company should at least require a basic liability policy to make sure that you are insured against liability damages. If you are self-employed or work for a company with no employees, you may be able to add PLI to your self-employed health insurance plan. If you are injured in an accident on the premises, your PLI will cover your medical expenses as well as your company’s liability insurance.

Some common PLI exclusions are: pandemic disease, preexisting conditions, and negligence. If you suffer an injury or illness at work that would likely make you eligible for a PLI claim, you should mention these exclusions to your insurance provider ahead of time so that they can properly exclude your claim. If you are injured on the premises, your claim should be denied.

If you are unsure whether your employer has a public liability insurance policy, you should ask your state’s department of insurance for a copy. Once you receive your state’s premium rates, you should compare them to other local premiums to see exactly how much public liability insurance cover your employer is offering. If you are unsure whether your employer is properly covered, you should speak to your underwriter. They can give you a great estimate of how much public liability insurance cover your employer pays, which can help you figure out whether you need to purchase PLI.