Archive for the ‘public liability insurance’ Category

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Public liability insurance

Tuesday, December 20th, 2011

Public liability forms part of the law of tort. This relates to civil wrongs, as opposed to criminal wrongs. Someone that suffers a tortious injury is usually entitled to claim damages for injuries suffered. This is of course just a simplification, but it’s aim is to show that public liability is governed by parts of UK law. As with most aspects of the law, judgements are based, in the main, on a mix of two things. Firstly, existing legislation and secondly precedents that have been set. We hear in the news of some law dating back to the 18th Century, for example, that is still in force. If a judgement is pursued under this law, it is up to the judge to balance on the one hand an antiquated piece of legislation and on the other, any judgements that have been made based on that law. The intention being that, on balance, the law is equally applied to one and all.

Public liability is the same. In theory, you can only be held liable if there is some proof of negligence. There are certain cases where you do not even need to be proven to be negligent, but mainly there has to be proof. Whether we all think it is for the good of the country or not, the UK was opened up to make it easier for the person in the street to pursue valid legal action. Certain solicitors have taken this just a bit too far. Again, we read in the news of some action that has been taken which 99 people out of 100 would say is just a joke but they are successful. This is why businesses need to have public liability insurance. There is no legal requirement, usually, to have this cover in force.

However, it is another one of our sensible and prudent covers to have. One of the main benefits of having this cover, is that the spurious claims can also be covered. What this means is that if you have a formal claim made against you, your insurers will deal with this and decline it on your behalf. We see the solicitors letters on a regular basis and if you are happily running your business and then receive a 28 page letter accusing of you x and asking you to prove y and respond by z, it can be very daunting and intimidating. Sometimes deliberately so. This is where you want the reassurance of having a robust policy in place. The other thing you want, and we can offer you, is a good business insurance broker that you can pass everything to and to deal with on your behalf.

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Office insurance – declaring “manual” work away

Friday, December 9th, 2011

Office insurance, like pubs, restaurants, hotels, shops and salons, is something that most of the main UK commercial insurers have designed a package policy for. Rather than speaking to an insurer and saying that you need cover for contents and computers and business interruption and employers liability and public liability etc etc, insurers have package products which contain the normal covers that the particular trade would require.

For offices, the policies will include, or have the option of including, buildings, contents, stock, business computers, employers, public and products liability, money, goods in transit, portable equipment away from the premises (ie smartphones/laptops) and business interruption. This blog is concerned with public liability insurance, as part of an office package.

Public liability insurance covers your business for any accident, illness, disease or damage, caused to third party persons or property. Therefore, if someone comes to see you and trips over a loose cable, this is public liability, if you visit someone and knock a PC off a desk, this is public liability.

Now, the astute amongst you will notice that these are fairly far fetched claims and really unlikely to ever happen. But, these claims do occur, day in and day out and the cover is required. The more common cause of claims under public liability, is where there is an element of what the insurers describe as “manual work away”. Now, your definition of manual work and the insurers definition of manual work will probably differ. To add to the confusion, some insurers have different definitions of what is manual and what is clerical.

We have learned that the best thing to do is to advise the insurers of all activities to make sure you are covered correctly. In the main this will affect those office insurance policies for computer related trades. For example, we had a quote request for a computer hardware re-seller. When I asked about work away, they said they may do the odd installation. What is involved in the installation? Cabling, plugging in hardware and potentially work in a computer room. Now,. we have at least half a dozen insurers that would quote for the office package. Half of them will consider this manual work and the others will not. You are better to ensure that all of your business activities are declared. Please do not assume that your broker or insurer has a full understanding of what you do and more importantly that you are covered.

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Public liability insurance – territorial limits

Tuesday, September 27th, 2011

All commercial insurance policies will contains clauses, conditions, warranties, terms and definitions. Without these, brokers, insurers, businesses, lawyers and judges would spend forever disputing, defining, disagreeing, agreeing the minutiae of what is covered and what is not covered. Even with the policies we have in 2011, even after years of “Plain English” type campaigns to make wordings better to understand we still have these debates, day in and day out. The point about these is that, without the majority of the wordings being clarified in this way, it is very difficult to know what your policy gives you.

The flip side of this coin is that it is very clear, in most cases, whether cover does apply and where it applies. Every single business insurance quote we provide details the sums insured, declared figures and limits of indemnity, as well as a summary of the cover. A basic summary can be 20 pages long, so you can imagine how long the actual wording is.

This is why it is so important that when you get your quote, you read through it from start to finish. We have to say to customers, when we issue their policies, that these must be read through from start to finish. We understand that siting down and reading through an eight page policy in it’s entirety, and actually understanding it, is something that not everyone is going to have the time to go through. But, reading through a quote and summary of cover is something that falls under the category of achievable.

Public liability insurance is important as it covers you for damage you may cause at third party premises. You need to make sure though, that if you are doing any work outside of the UK you are covered. Most UK policies will have a territorial limit definition which will be for UK mainland, Northern Ireland and the Channel Islands. You need to specify if you are doing work out of the UK and your policy will need to note this.

As an example, we have a customer who imports and supplies gift items. They were attending an exhibition in Paris, when their stand fell and hit a neighbouring stand. The long and short of it was, that they had a claim settled for around €12,000. The UK commercial insurance company dealt with the French insurers of the third party and it was settled very quickly. Without this cover being in place, it would have been very costly and even more time consuming for our customer to settle such a claim.

As we always say, speaking to a business insurance broker is the way forward if you want to get the right cover, at the right price.

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Public liability insurance – £10,000,000 limit of indemnity

Friday, June 17th, 2011

If you are a contractor (ie working for, or providing services to another company or organisation) then you will probably have been asked at some point to prove you have public liability insurance in force. Why does this happen? The insurers of the people you work for will, more than likely, have applied a bona-fide sub-contractors checking condition. A bit of a mouthful, but basically they are saying that if they are providing liability cover, they do not want to have to pay out for the actions, errors or injuries/damage caused by contractors. To cover this they say that there must be a check of the liability cover.

Now, the lengths that companies go to vary a great deal. As a business insurance broker, we have a specially designed, single page, proof of cover document which is acceptable to insurers and outlines exactly what they are looking for. The variances go from just being asked “do you have cover”, to proving you have cover, to proving you have cover at a certain limit of indemnity.

The last one is causing some customers to review their liability insurance arrangements. It used to be that most companies were happy with £5,000,000 as an absolute maximum. Nowadays though, there are more and more asking for £10,000,000. Of course, this is way, way over the top in 95% of cases, bit this does not stop companies asking for it. Worse than that, if you cannot prove this, they will not pay you, simple as that.

Businessinsure are able to get you cover up to £10,000,000 by providing you with £5,000,000 from your main insurers and then going to another one for the additional £5,000,000, to give the £10m you need. Even if you do not deal with us for your main insurance, we can get you an excess layer quote, usually the premium is between £550 and £600 per annum. All we would need is a copy of your underlying, or main insurance policy.

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Public liability insurance – height limits

Saturday, May 14th, 2011

Public liability insurance will either cover clerical and managerial (non-manual) business activities, or manual activities. The first, and lower risk, is cover for businesses where there staff may visit other properties and in the course of that visit, cause injury or damage. So, the salesmen goes to visit a customer and accidentally knocks a PC over. Yes, this is a scenario that is unlikely to happen, a once in a blue moon event. But, these things do happen and this is where a policy will step in and pay the cost of any damage caused.

The events that are more likely, and of higher risk to the commercial insurance companies, belong to the manual trades. The plumbers, air conditioning engineers, painters and decorators, carpenters and electricians are the typical trades that have more public liability claims. Where they do have claims, they tend to be of higher costs.

The frequency of claims does not tend to be too high, most contractors will tend to try and sort out any problems directly, rather than resorting to making a formal claim. That said, if it does get to the stage of a claim being made, then the cost is likely to be high. The last thing the contractor needs is for their insurers to turn around and say that there is no cover in place.

This does not happen very often and only tends to be the fringe insurers that thrive on referring to the small print. As a business insurance broker, we are not allowed to recommend a policy with an insurer that we have any qualms about. The only problems you usually have with insurers, relate to their ability to pay claims. We do not use insurers that we have concerns about, but this does not stop others using them.

One of the reasons that they may turn down a claim is height work. Most contractors policies will allow work up to 10 metres. This usually means the top eaves of a standard two storey house.  Any higher, and the insurers must be told. If you do not tell them and you are working in or on a block of flats or an office block, this could cause a problem.

Two things for you to do. Firstly check your policy to see if there is a height limit and secondly, if you do have a limit, get on the phone to your broker to see if the insurers can extend the height limit. It is always worth seeing if it can be done for free. However, there may be an additional charge for this.

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Business insurance – exhibition cover

Friday, May 13th, 2011

More and more businesses are now attending exhibitions. We have an increasing number of calls from sales people offering us stands at exhibitions throughout the UK and EU.

Whilst we do not attend exhibitions ourselves, many of our customers do. There are two points to consider, as far as business insurance is concerned, when attending exhibitions.

Firstly, you will be asked, in the majority of cases to prove that you have public liability insurance that extends to cover you whilst attending any exhibitions, trade show or similar event. Usually, the limit required will be £2,000,000. This needs to cover your business in the event of any damage you may cause to third party property (eg someone else’s exhibition stand) or third parties (eg if your stand falls and hits someone).

Caution is required here. If you do not have the cover, the exhibition organisers have bene known to charge up to £250 under their own scheme. This is way, way over the top. The chances are your current policy will already include this cover. If you need EU cover, then this could be somehting you need to pay for.

Secondly, you need to make sure that your policy covers any exhibition equipment, contents or stock that you may take with you and leave at the exhibition.

We have just had a call from an existing client who have added up the cost of all their exhibition equipment, which is just display stands and a demonstration PC and it is just shy of £10,000. This needs to be covered anywhere in the world and at present, they do not have the cover.

Sometimes you are better getting an annual extension to your policy cover as you may find that some of the smaller commercial insurance companies charge extortionate fees for one-off extensions. Adding the equipment on an annualised basis may be the best way to go. If you have bought your cover the right way, then you will have a business insurance broker that you can discuss your requirements with.

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Business insurance – manual work using heat

Tuesday, May 10th, 2011

Having worked for a large commercial insurance company for many years, prior to my current role, there were many types of work that the underwriters did not like. When I say underwriters, I mean the proper ones at the top of the tree that actually decided the individual premiums for classes of risk. Nowadays an underwriter usually just means someone that can apply the rates in a manual to get a price. A true underwriter is the one that puts the rates in the book in the first place.

Apart from the usual high risk public liability insurance categories, such as working on oil rigs, airports, nuclear plants etc etc, they did not like (and still do not) businesses where there is a lot of heat work. By heat work (or hot work), we mean using blow torches, blow lamps and welding equipment. In effect anything that uses a naked flame. Soldering irons and glue guns do not fall under this category as they usually safer.

Now, when we say the underwriters do not like this type of trade, this does not mean that they are not prepared to cover them. What they do is to rate the risk accordingly (ie charge a higher premium if necessary) and apply terms and conditions to ensure when heat is used, it is used carefully.

We speak to many, many contractors, builders, electricians, plumbers, heating engineers, you name it, on a day to day basis. They all tell us that the hot work permits you need nowadays to work on bigger sites, are extremely onerous. So onerous in fact, that they cannot even perceive there to be a chance of a loss.

That said, losses do occur and when you are using fire, usually in an enclosed space, with gas canisters in the vicinity the losses are not going to be very small. When they do occur, these are the multi-million pound fires that you read about in the press. The problem for businesses is, that the conditions in policies regarding the use of heat, do not always tie in with what is required under a hot work permit.

If you do use heat you need to do two things. Firstly, tell your business insurance broker to ensure that your policy cover you correctly. And secondly, make sure you read through any heat use conditions in your policy.

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Office insurance – public liability at £5,000,000

Wednesday, February 2nd, 2011

If you are working for another company, or government body (including local authorities) you will probably find that you are asked to complete a pre-contract business insurance form.

What this asks, is that you provide details of all of the current insurance covers you have, which will need to be at the levels that the form requires. The form will contain, as an absolute minimum, the three levels of liability cover, employers, public and products.

Anyone in business will know that you must have employers liability insurance in force if you have any employees. What is less well known is that the law says this must be at a limit of indemnity any one claim of £5,000,000, whereas most insurers automatically provide this at £10,000,000. Hence, the form will state that you need £10m.

As far as public and products liability is concerned, most will request that you have a limit of £5,000,000. Whether you need this cover (at this limit) or not is immaterial, if you want the contract you need to have the cover. Most UK office insurance policies have cover automatically at £2,000,000.

The good news is that if you increase this from £2m to £5m (a 150% increase) the premium does not increase at anywhere near that sort of level. A typical small office insurance policy, that has an annual premium of £500 will only increase by 10 or 15% if the liability levels are increased.

The real costs can occur if you are asked to increase the public liability from £2m to £10m. Most insurers are only happy to provide a limit fo £5,000,000 in one “hit”. Asking them to accept the potential of £10,000,000 (albeit very rare) is too much. This is where we need to go to a different insurer to get the extra £5m. Typical premiums (annually) for this, cost around £550.

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Slips, trips, falls and injury in a company car park.

Saturday, December 18th, 2010

We have blogged before about this very topical subject. It is worth mentioning again though, how responsible you can be held.

It is minus a few degrees outside my house and we have a few inches of snow again last night. If I decide to leave the snow, it obviously causes problems for anyone leaving or entering the house. So, I decide to remove the snow and as a result this makes parts of the path to my front door slippery. If the post lady comes along and slips on one of these patches of ice, can I be held responsible?

The same question applies to a business for any visitors, whether expected or not. If your business has a car park, for which you are legally responsible, then you can be held liable in three different scenarios.

You will only be legally responsible if you own the building and any land, or you have a full insuring and repairing lease.

The three different scenarios are:-

1) Injury to your employees, coming to and from work.

2) Injury to expected and un-expected visitors.

3) Damage to third party property, ie someones car.

We cannot stress enough, that for you to be held liable under property owners, or public liability insurance, that you need to be proven negligent. If the snow fell two minutes ago and a visitor slipped, then you cannot possible be negligent. The third party will have to prove that you were fully aware of how dangerous the car park was and that you simple did nothing about this. You have to be expected to clean snow (to allow access) within a reasonable timescale.

This does not mean that you have to have someone stationed in the car park clearing every flake as it lands.

Going back to my house, I can only be held liable if it can be proven that I have deliberately made the path slippery, for example by pouring on cold water with the intention of it freezing. It is a hazard of the job that a delivery person may slip, it is not always the homeowners fault.

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Business insurance – slips, trips and falls in the snow.

Monday, November 29th, 2010

Here in Scotland, as with most of the UK, we have been hit with some pretty heavy, persistent, snow fall.

The gritters are of course trying to do their job, but it seems to be a struggle to keep the main routes open, let alone the side roads. Homes and businesses are doing their best, but we have already had a couple of calls from people wondering how their business insurance will react if someone falls. the question is, what happens if someone blames them for not clearing pathways, or for clearing pathways and making them icy.

The answer is, if you have valid cover in place, you really should not worry. There was a representative on the radio last week from the local government association. He was effectively saying that it is bit of an urban myth that you are not allowed the clear the path in front of your house. He was pleading with the people of the UK to get out there and do what they can in the interest of community spirit.

Businesses though, are a slightly different kettle of fish. You need to make sure that you have adequate public liability insurance in place, particularly if you have car parks. Whilst you have nothing to worry about, this does not stop the spurious claims being submitted. Your liability insurance should help fend off even the most laughable of claims. Do not, whatever you do ignore any claim or try and deal with it yourself. Always, always speak to your business insurance broker for any advice, particularly if you receive a solicitors letter. If someone does fall, offer to help them if required and if possible, take photographs of the area where they alleged they fell.

If they do decide to go to a no win no fee solicitor, and you receive a letter, get this to your insurance broker as soon as possible and let them notify your insurers.  You can only really be held liable if it can be proven you have been negligent. If you are open for trade, you need to make it as safe as possible for customers to visit your premises. If this involves clearing a path and putting some salt or grit down, then you can do so. If your car park is not safe then put signs up saying the car park is not to be used. You cannot really do much more than that.

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