A public liability cover is a very important insurance for a business. It provides cover from any mishap that may take place to a customer or to a third party while on the business premises. The policy covers lawsuits and expenses incurred in fighting lawsuits as well. The policy covers injury to the client or his property on client’s premises. However, before choosing public liability insurance, there are certain things that a person should keep in mind.
Risk factor in the business
The insurance should be taken based on the risk factor involved in the business. Although accidents to clients or their properties can happen in any business, the risk factor is high in certain types of businesses. For example, a home based business will not need a very high insurance cover whereas a construction company or a road works contractor will need a high cover.
A brief study of the levels of insurance covers that other similar companies in the past and the present have taken will give a businessman an idea of the optimum level of insurance policy. Also, since this policy covers risks and damage on the client business premises as well, a businessman will need a high level policy if his client’s business area is prone to risks or accidents. Therefore, based on the risk factor of a business, a businessman can decide the size of the policy.
Risks of lawsuits
Some businesses are prone to being sued more than other businesses. For example, a corporate hospital is more likely to face lawsuits from the patients. Other examples are businesses dealing with food articles and other edibles and fitness and beauty salons. Such businesses will need more cover when compared to the other businesses. Since the cost of lawsuits is generally high, having a policy to cover for the businesses will be a big help in times of accidents. The expenses incurred in defending oneself are also high as efficient attorneys charge very high fees. So, businesses which are more prone to being slapped lawsuits can opt for a higher level of insurance cover.
Understand the terms and conditions of the insurance
Different insurance companies have different types of insurance covers. Each company has its own terms and conditions. So before you purchase a policy, go through the terms and conditions of the insurance company carefully and find out what kind of covers they provide. Also read the conditions under which they provide cover. Some insurance companies have very stringent rules about the payments they give in times of accidents. If there is a lot of paperwork involved in the transactions or if you find out that the company does not release funds on time, then you may want to choose another insurance company. You can get more than one insurance quote and compare the benefits you receive before settling on an insurance policy.
Before selecting public liability insurance, you need to be sure that you can pay the monthly premiums. Check out your finances and prepare a financial plan of the company. The premiums should not be a burden on you. If yours is a small business needing a high level of insurance policy, then you will want to select a policy which offers low premium amount. You will need to work out and reorganize your finances in order to accommodate the premiums amount. Having an insurance to cover for accidents to the customers or their properties is one of the most practical insurances to have. So, make space for the monthly premiums in your business budget.
By John Benson