What is the Average Cost of Public Liability Insurance?

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As an across-the-board average, the cost of public liability insurance annually is £118, based on a survey of quotes by NimbleFins. Depending on your business, the number can change based on the industry you work in and how much risk is associated with your profession.

For example, the cost of a £2 million public liability policy will be much higher for a builder than for a caterer. As the assessed risk of the business increases, the premium price goes up. This can also be true for different business structures; a limited company will pay more than a sole trader for a comparable policy. There will be an even higher premium if the limited company has more than a single director.

You may be wondering, ‘how much is public liability insurance‘ – will quotes for your business be cheaper or more expensive than the £118 average cost of public liability. To answer this question precisely, compare quotes to view deals from multiple providers and compare features side-by-side.

Who needs public liability insurance?

For any business that interacts or deals with the public, having public liability insurance in place will ensure the protection of assets and finances. If there is an accident or an incident that occurs during business operations that affects a third party, you will be liable for any claims. Whether your business is a partnership, a limited company, or you operate as a sole trader, the same rules apply.

As a business owner, you are responsible for providing a safe environment for visitors to your premises. Even if you perform work only at a client’s location, you may still be expected to be insured against claims for losses, accidents, or property damage. Some clients will require that you have public liability insurance in place before performing any work at their location.

What does public liability insurance cover?

Public liability insurance covers legal expenses and compensation payments for work-related injuries to members of the public or damage to their property.

For businesses operating from a physical location that is frequented by the public, it is wise to have public liability cover to ensure protection from claims brought against your company. If your home is used as your business premises and visited by clients, then coverage will still be needed. In the event of an accident or incident, you will still be liable even though the event occurred at your residence.

For accidents, losses, or damages that occur during the business’s performance and result in a claim from a third party, public liability insurance will provide financial protection. Successful claimants can be awarded large sums of money for settlements or compensation payments, costs of replacement or repair, and medical expenses.

Although it is not required by law, having adequate public liability insurance means that claims will be covered by your policy and will not have to be paid out of pocket. If there is no policy in place, the cost of any claims will have to be paid by the business or from personal funds.

Cheapest public liability insurance

Finding the cheapest insurance policy can take some effort as there are a large number of providers to select from. There are a few different to locate and purchase a public liability insurance policy.

  • Use your existing insurance company
  • Use the services of a broker
  • Buy direct from the insurer
  • Use a search comparison engine

Shopping around for the best quote available can be time-consuming, so it helps use a comparison site. These sites will help you compare multiple quotes from different providers quickly, making it easy to assess each one’s features.

It must be noted that the cheapest policy may not always be the best for your business, and careful attention should be paid to coverage amounts, excesses, and exclusions. Policies range from £1 million to £10 million, and limits should be carefully assessed to ensure you are getting adequate coverage for your business.

How much is public liability insurance?

As a general rule, the more coverage you need, the higher your annual premium will be. For limited companies with 2 directors working in a high-risk industry, premiums will be up to 2.5 higher than for a sole trader in the same business.

For example, a sole trader working as a builder will pay around £82 annually for a £2 million policy. But a limited company with 2 directors working in the same industry will pay £456 per year, a difference of £374. Excess amounts and insurance add-on coverages can also make premiums rise.

The amount of coverage that you require will also impact the cost of annual premiums. A £5 million public liability insurance policy will be most costly than a £1 million policy. Average annual payments may increase due to the amount of coverage purchased, insurance add ons or special coverages, and different excess levels.

NimbleFins has run sample quotes to find the cost of public liability insurance. While prices vary from business to business, these can be a rough guide to starting premiums.

Total coverage Annual premium
£1 million £106
£2 million £118
£3 million £140

Business requirements and risks should be assessed carefully to ensure that adequate coverage amounts are in place.

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