Public Liability Insurance in Victoria

How does Public Liability work in Victoria? 

Imagine you’ve just opened your brand-new hairdressing salon and a customer slips on a pile of hair on the floor, resulting in a nasty injury and a potential claim against your business.  

This is where Public Liability insurance comes in. It could offer a financial safety net if a member of the public – say a customer, supplier, tradesperson or even someone simply walking past your salon and minding their own business – is injured or suffers property damage, whether they’re on your premises or using your goods and services. 

In Victoria, public liability falls under both common law and the Wrongs Act 1958 (Vic), a statewide piece of legislation that governs claims for damages for personal injury and death. 

There’s a time limit to file a claim, too, but this comes under the Limitation of Actions Act 1958. This Act says that someone typically has three years from the incident to file a claim, except under certain circumstances.  

Is Public Liability Insurance mandatory in Victoria? 

For most Victorian businesses, Public Liability insurance isn’t obligated by law. But there are a few cases where it is.  

For example, under the Licensed Plumbers General Insurance Order 2002 (Vic), all licensed plumbers operating in Victoria must have Public Liability Insurance.  

Many councils (including the City of Melbourne), venues and workplaces also require it if you’re undertaking certain business activities in public, like holding an event, doing construction works, fundraising, working on-site, selling products or conducting those aforementioned street art tours. 

That being said, it could still be a very good idea to take out a policy if your business interacts with or sells products to the general public. This might involve people coming to your premises, visiting other sites to conduct your business, hosting public events or even having a job location that has passers-by – like a construction site or peddling your home-roasted coffee beans on the street. 

Businesses in Victoria that could benefit from Public Liability insurance include: 

• Restaurants, cafes, bars and pubs 
• Hotels 
• Entertainment venues 
• Tour operators
• Retail and food stores 
• Event planners 
• Contractors and freelancers who visit worksites 
• Building companies 
• Cleaning services 
• Landscaping and gardening services 
• Medical clinics and other healthcare providers 
• Hairdressers and beauticians 
• Gyms, group fitness or personal training 
• Real estate agencies 

How will Public Liability Insurance protect my business? 

There are several scenarios where Public Liability insurance could protect you and your business, including: 

• If a third party injures themselves at your business. You could be liable to pay medical expenses for any injuries (including psychological damage), as well as compensation for the claimant’s lost income. You might also be fronted with a lump sum payment 
• Damage or loss of third-party property. Let’s say a few tins of craft IPA fall off the shelves at your new brewery and break a customer’s smartphone. You may have to pay to repair or replace it 
• Court costs and other legal fees. Should the matter end up in court, you could have legal representation fees and related admin costs to think about 

Coverage can vary between insurance providers and policies, so take a good, hard look at your policy wording to see how you’re covered. 

Are my employees and I covered by Public Liability Insurance? 

Public Liability insurance only covers members of the public – not you or your employees. But don’t worry, you and your employees don’t have to be left totally high and dry. 

If one of your employees injures themselves at work, the incident will likely fall under workers’ compensation. If something happens to you while you’re working, it will also fall under workers’ compensation, provided you’re an employee of your business, or personal death, illness and disability insurance if you’re not. 

Workers’ compensation is mandatory if your business employs workers in Victoria, including yourself.

Helpful tips from BizCover

Operating your business from home? Whether you’re running a home-based Pilates studio, art gallery or consultancy firm, Jane Mason from BizCover says you should still look into coverage to protect yourself financially. 

“You might think working in your own private home means Public Liability Insurance is irrelevant,” Jane says. “However, it could be worth getting insurance if you have clients, customers or other members of the public visiting.”

Jane Mason

Head of Product, Channels & Risk at BizCover

How much does Public Liability Insurance cost in Victoria? 

Because the scope of Public Liability insurance is so broad, the cost comes down to several factors. These include: 

• The size of your business. Bigger businesses may have to pay more as they generally have greater exposure to claims. 
• The type of business you have. Construction, for example, is inherently riskier than retail (the same could be said for a cycling tour of the Great Ocean Road versus a tea parlour in Brunswick). 
• Your location. Premiums can vary depending on claims history in a particular area, plus in Victoria, there’s a 10% duty on insurance policies. 

Ultimately, the cost will largely come down to the provider and policy you choose. There are varying coverage limits, features, add-ons and exclusions between providers and policies – all of which could affect your premiums.  

What should I consider for my Public Liability Insurance? 

When you’re shopping around for Public Liability insurance, consider: 

• Your coverage limit. You can reduce your chances of facing a hefty payout by checking you’ve got an adequate coverage limit (i.e. the max amount your insurance provider will pay)
• Any exclusions. Understand your policy exclusions so you don’t encounter any surprise gaps when making a claim 
• The cost. Premiums (AKA price) are a major consideration when deciding on a policy, but there should be a nice balance between affordability and ample coverage 
• Bundling options. To bring your costs down, you may be able to bundle your Public Liability insurance with other useful types of coverage, like Product Liability insurance and Professional Indemnity insurance 

Where can I find and compare Public Liability policies? 

If you reckon Public Liability insurance could be a good idea for your business, compare policies with iSelect. 

Together with BizCover, use our handy comparison tool that lets you weigh up policies between our range of providers.