What is Public Liability Insurance?

Public liability insurance may seem confusing, but it doesn’t have to be. In simple terms, it’s a way to protect against unexpected financial troubles that can arise if accidents happen. Canstar provides a clear explanation of public liability insurance and guides you on when you need it in this handy guide.

What is public liability insurance?

Public liability insurance protects both you and your business from financial consequences if you are held responsible for the loss or damage to someone else’s property, or if you cause illness or injury that is not covered by the Accident Compensation Commission (ACC).

What does public liability insurance cover?

Public liability insurance typically covers the following:

1. Bodily injury

If a third party, such as a customer or a passerby, is injured on your business premises or as a result of your business activities, public liability insurance can cover the medical expenses, legal costs, and compensation for the injured person.

2. Property damage

If your business activities cause damage to someone else’s property, this insurance can cover the costs of repair or replacement.

3. Legal costs

Public liability insurance helps cover the legal expenses associated with defending against a third-party claim. This includes attorney fees, court costs, and any settlements or judgments.

4. Accidents outside business premises

Coverage may extend to incidents that occur outside your business premises, such as at a client’s location or during off-site events.

What does public liability insurance not cover?

1. Damage to your own property

Damage to your own property isn’t generally covered by public liability insurance. If you are looking to protect your own property, you would typically need a different type of insurance, such as property insurance.

2. Personal injuries covered by ACC

If an injury is already covered by the Accident Compensation Corporation (ACC) it will not be covered by personal liability insurance. This includes any injuries to employees.

3. Intentional acts

Deliberate or intentional actions that result in harm or damage are often excluded. Public liability insurance is designed to cover accidents and unintended events only.

4. Known claims and circumstances

In general, insurance policies, including public liability insurance, typically exclude coverage for known claims or circumstances. If you are already aware of a situation that might lead to a claim, it may not be covered once you purchase the insurance.

Do I need public liability insurance?

If you run a business that involves interactions with the public, customers, clients, or other third parties, public liability insurance is often recommended. This is particularly true if your business operates physical premises that people visit.

In some cases, public liability insurance may be a legal or contractual requirement. Certain industries or clients may demand that businesses have this type of coverage to protect against potential liabilities.

Home and contents insurance

It pays to be insured if you’re having work done on your property. While public liability insurance may cover any damage that occurs to your home and contents, it’s always recommended to have your own insurance. Compare the best home and contents insurance in New Zealand by clicking the button below.

Compare home and contents insurance with Canstar

About the author of this page

This report was written by Canstar Content Producer, Caitlin Bingham. Caitlin is an experienced writer whose passion for creativity led her to study communication and journalism. She began her career freelancing as a content writer, before joining the Canstar team.

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