2nd June 2010
The Cost of Public Liability Insurance
premiums have been rising considerably over the past few years. It is a common
insurance policy that is required by every business person/company even if the
business is conducted in your own home. It is an insurance policy which could
cover any claims for damage or injury that is caused to a third party. This
third party is referred to members of the public, visitors, customers, clients
etc. If any of these mentioned persons or even their property is harmed, they
can file a complaint against your company.
In the 1970s and the 1980s there were a
series of medical malpractice claims, which made governments conduct wide range
reviews of the insurance industry, giving opportunities for the introduction of
a variety of insurances.
Some businesses opt for the basic liability
insurance and also public liability. In some regions, even though it is not
compulsory by law, most companies opt to purchase both, even though the cost is
Small businesses find it difficult to
afford the Cost of Public Liability Insurance. In case they are faced with a
lawsuit, the cost of the legal offence and a possible settlement will be far
higher than the cost of the insurance. Due to this oversight and negligence of
being appropriately covered, many small businesses have gone bankrupt.
It is always advisable to consider any and
all potential risks when deciding on the insurance policies. The more chances
you are exposed to risks, the more coverage you should have. Public liability
risk is the highest especially where third parties gather in large numbers on a
frequent basis. For example, places such as shopping malls, restaurants,
grocery stores, theatres, sporting arenas, hotels etc. are high risk for
If the level of risk is high the Cost of
Public Liability Insurance also increases.
There are instances when insurance
underwriters can deny coverage because the level of risk is so high.
Public liability insurance does not cover
any intentional, criminal or negligent action. For example, if a person jumps
into a lake where there is a sign which says “No Swimming” and he suffers
injuries, the owner of the property is sued for damages. Even though it was not
the negligence of the owner, he is yet forced to defend the law suit. It was an
intentional act on the part of the swimmer, yet he has the ability to file a
lawsuit. Any person has the freedom to file a lawsuit, and the accused
person/persons need to defend themselves. Due to these types of lawsuits
increasing so much in our present day society the Cost of Public Liability
Insurance has increased drastically. When you are covered by such an insurance
policy, even if you are not at fault, your insurance company will settle you.
They opt for this settlement because the cost of defending a lawsuit in court
is more costly than the requested settlement.
Due to the high increase of the many
unfortunate and unpleasant incidents in society today, insurance companies have
no option but to pass the costs on to the consumer by increasing the premiums.