Do Small Businesses need Public Liability Insurance?

Even though a business may be small, it can still be vulnerable to having claims of negligence made against it. These claims when made by third parties can be covered if the small business has what is known as public liability insurance. Claims can be made for a variety of reasons. They can also vary in severity. Even if a business is small, it should still obtain public liability insurance in order to protect itself in the event that a claim is made.

When third party claims of negligence are brought against a small business, the consequences can be quite severe if the company does not have public liability insurance coverage. As a small business, one’s capital is probably rather small. When claims are made and awarded, the amounts of such are usually rather large. These amounts are large enough that it could significantly impair the ability of a small business to conduct their affairs. It doesn’t matter if the small business is run from the owner’s home or from a dedicated business property. The company is still liable for any injuries that occur to third parties or damage that might occur to their property.

If a claim is made against a small business, it would possibly get away with it but there’s also the likelihood that the company will be ordered to pay damages to the claimant. It is better to err on the side of caution and take out the policy to protect your company if you need it. Having public liability insurance protects a small business if they must pay damages. Another important part of public liability insurance pertains to legal expenses. A lawyer will need to assist with a claim which will result in legal bills. Public liability insurance will help pay these expenses. A small business may also be ordered to pay the legal fees of the claimant as well which would be covered with a public liability insurance policy.