Public Liability Insurance For South Australia

If you run a business, you’ll understand how difficult it is to keep track of rules and regulations in your state. This is especially true when it comes to your obligations towards other people and property.

Public liability insurance is available to protect you and your business against some claims for negligent business activities that cause injury or property damage to a customer, supplier, or member of the public, saving you from what could be a stressful and costly process.

What is public liability insurance?

As a business owner in SA, you have a duty of care towards your customers, suppliers, and members of the public. In short, you have a responsibility to take reasonable steps to protect the safety of anyone who interacts with your business. That’s where public liability insurance come in.

Public liability insurance can provide cover in the event that a person/persons in the previously mentioned groups becomes injured, or has their property damaged, as a result of negligent business activities*.

A negligent business activity can be thought of as an avoidable risk, such as the cross-contamination of food in a restaurant, or failing to clean up spilt water in a reception venue to prevent customers slipping and injuring themselves.

What does public liability insurance cover?

The level of insurance that’s suitable for you depends on the size and nature of your business. While policies vary in terms of inclusions, exclusions and policy limits, insurance can typically cover:

• Third party property damage or loss: Coverage if someone else’s property was damaged or lost due to your negligence. For example, you own a dry-cleaning company and a wedding dress was damaged due to incorrect cleaning fluid being applied
• Product Liability: Coverage if your business negligently sells or supplies defective or contaminated products causing injury, death or damage
• Legal costs: In the event that it’s necessary for legal help to be engaged to respond to a claim, you’ll be covered for the reasonable associated costs
• Third party injury: If someone is injured (or killed) when visiting your business, either from defective products you sold, or from an avoidable risk, you can be covered for resulting compensation claims as well as any associated first aid expenses
• Injury or loss caused by someone else in your business: If someone else, such as a member of staff, in the course of their employment in your business negligently causes third party injury (or death) or property damage during an incident, cover can be available

Prior to making a decision on a level of cover, ensure you review the Product Disclosure Statement for details of policy inclusions, limitations and exclusions.

Do you need public liability insurance in SA?

While no two businesses are the same, purchasing public liability insurance could be a worthwhile consideration for almost all businesses in South Australia.

If your business has a premises and/or sells a direct-to-consumer product (eg: café, bar, restaurant, reception centre, or school), then public liability insurance can help provide protection in the event that you’re sued for negligence.

In short, the more customers, suppliers, and members of the public interact with your business and its physical premises, the more you may require suitable public liability cover.

As mentioned earlier in this article, you have a duty of care to take reasonable steps to protect the safety of these people and their property, and if they’re injured because of an avoidable risk arising from your business activities, they can claim against (and even sue) you for damages. In this event, public liability insurance can cover your exposure to pay damages as well as legal and defence costs*.

In some cases, public liability insurance is mandatory

Some industries may require that you hold some level of public liability insurance as a licensing requirement. Additionally, some associations and contracts specify that you hold at least a minimum level of public liability cover as a compulsory requirement to do business.

How much does public liability insurance cost in SA?

There’s no one set cost for public liability insurance, as it varies depending on the nature of the risk involved. Some factors that can affect that risk can include:

• The type of business you own and its industry
• The size of your business
• The level of turnover
• How much interaction the public has with your premises
• The level of cover you seek

Think about the nature of your business, and how much interaction customers, suppliers, and the general public have with you and your premises. For example, if you run a cafe or restaurant, you may need more coverage than if you run an office-based business.

Typically, in a café there’s a greater chance of someone slipping on spilt liquid or being sick from cross-contaminated food, as compared with a corporate office in Adelaide.

Some other insurance products that might be relevant?

As a business owner, there are several other types of insurance you could consider¹. Remember that none of the below are compulsory under legislation in South Australia, but could be suitable depending on the nature of your business.

Management liability insurance:

If you own a business, or if you’re heavily involved in the management of a company, you carry specific responsibilities that may leave you personally liable for any issues that arise. Management liability insurance can protect you against the financial risk of claims regarding the alleged or actual mismanagement of the business.

Cyber liability insurance:

This insurance covers your business against the expenses which can arise in the event of a cybercrime incident, including the costs of data recovery, fines, compensation payments and any business disruptions caused. Learn more about cyber liability insurance here.

Tax audit insurance:

Tax Audit Insurance covers your business in the instance that you’re selected by the Australian Tax Office for auditing. It covers the costs of external accountants and some other fees incurred in the course of an audit.

Professional indemnity insurance:

Unlike public liability insurance which protects you in the event of damage or injury inflicted on a person or their property from your goods or service, professional indemnity can protect your business against claims for damages resulting from your negligent act, error, or omission while providing specialist advice to or consulting with a client.

Prior to making a decision on a level of cover, ensure you review the Product Disclosure Statement for details of policy inclusions, limitations and exclusions.

Compare public liability insurance products with iSelect and BizCover

If you live in South Australia, with iSelect in partnership with BizCover you can compare business insurance products to find a policy for you. Get started online today, or call 13 19 20.

*Please note that all insurance is subject to the terms and conditions set out in the policy wording or Product Disclosure Statement. The information set out above is general only and should not be relied upon as advice.

Sources:
1. https://lawhandbook.sa.gov.au/ch08s14.php