How Much is Public Liability Insurance for A Limited Company?

How Much is Public Liability Insurance for A Limited Company?

For small limited companies, public liability insurance costs around £77 per year on average. This number increases up to 2.5 times if the business has more than one director. Other factors will impact the amount of the annual insurance premium. The type of business you operate can cause dramatic fluctuations in the overall cost due to the assessed level of risk.

Other considerations like policy limits, excesses, and special coverages will also increase the amount of the premium paid and the scope of work you perform. All these items combined can raise or lower the cost of your public liability insurance premium.

It is wise to shop around and compare quotes from different insurers to find the best possible deal. NimbleFins has an in-depth cost comparison page showing calculations for potential public liability insurance costs. There you can also compare deals from multiple providers to identify the best public liability insurance policy for your limited company.

Do I need public liability insurance for a limited company?

Any limited company that comes into contact with the public during the course of business operations should carry public liability insurance, though is not an actual legal requirement. Regardless of the law, the financial cost of not having public liability insurance can be high if you are on the receiving end of any claims made against your business.

If you operate your business from home and use a part of your property as an office that clients visit, then you would still be well advised to have public liability protection in place. If an accident or damage occurs during business functions, you would be responsible for any claim that is made, even if the incident occurs on your personal property. Home insurance might offer suitable protection, so be sure to enquire with your home insurance provider.

In some instances, a client you are performing work for might require public liability insurance. This can include organisations like local authorities or government offices that can require you to have specified minimum insurance limits in place. Proof of coverage will need to be provided, and you may have to revalidate on an annual basis. For some highly regulated or governed businesses by the rules of trade bodies, public liability insurance cover may also be necessary.

What is public liability insurance?

Public liability is the insurance that protects your business and personal assets from any claims leveraged against your company. It pays for the cost of repair, replacement, and any medical or legal fees associated with the claim.  It is third-party only insurance and does not cover any loss or damage to yourself or your employees. Accidents or incidents of this nature would be covered under the employer’s liability insurance.

If you have no public liability policy in place, then your business would be responsible for paying legal fees, replacement costs, or expenses for medical treatment. Even in the case of unsubstantiated claims, there can be a legal cost accrued from defending your position. Public liability will cover you for the cost of fighting false as well as legitimate claims.

If your business operates from physical premises, it is your responsibility to make sure that it is safe for members of the public, effectively ensuring their protection from any harm or damage. If you operate a business where there is no exposure to the public, for example, you run an online-only company with no physical public interaction, and then public liability insurance might not be needed.

Limited company public liability insurance cost

There are a few factors that can affect the price of your public liability insurance. Occupations that carry a high risk will be more expensive, and if a high level of coverage is required, then the annual premium can soon be much more costly.

If your business is assessed as a low-level risk, then the opposite is true, with some companies paying premiums as low as £50 or less. Limited companies typically cost more to insure than sole traders performing the same sort of work.

Limited Company Business Type Cost of annual premium

1 Director

Cost of annual premium

2 Directors

Personal Trainer £50 £131
Engineer £139 £139
Market Trader £92 £217
Gardener £71 £274
Builder £82 £456

Differences in the type of industry create a wide variance in premium prices, but the businesses with the lowest risk factors will maintain a lower policy cost. At the same time, those companies involved with high-risk business functions will be required to pay much higher premiums. This number increases again with the addition of an extra company director.

For limited companies, the annual premium price will also be affected by how much excess is required (the portion that you pay towards any claims) and the total amount of protection needed. Public liability insurance coverage policies start at £1 million and rise to £10 million and above as required.

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