Public Liability Insurance Australia

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When it comes to business insurance in Australia, there is no form of cover more popular than public liability.

As more and more people turn to the courts to seek damages against companies when they believe they have suffered a loss, it has become even more important for businesses to protect themselves.

Thankfully here in Australia there is a very competitive market when it comes to public liability insurance, and this means that the premiums are very affordable for most business types.

In this guide we’ll take a closer look at public liability cover for Australian businesses.

What does public liability cost?

The cost of public liability insurance can vary greatly from as little as $300 a year through to many thousands per year. The cost will depend heavily on the type and size of business that you run.

You can find out more by reading our public liability insurance cost page.

What is Covered?

There are two main risks that Australian business can protect themselves against with public liability:

  • The risk of causing damage to another person’s property
  • The risk of causing injury or death to another person

These are both very serious risks, and the Australian legal system does allow people who have suffered such losses to sue the businesses responsible through the courts.

Prominent Australian law firm Slater & Gordon have put together this list of public liability claims they have fought for, and it is well worth reading for any business owner who doesn’t believe they’re at risk.

For more information on what is covered please visit our ‘what is public liability‘ guide.

Australian Insurance Providers

As mentioned earlier, here in Australia we have a very strong public liability insurance market. This equates to better coverage and more affordable premiums for most business types.

Some of the largest providers of this form of business insurance include the following:

  • Allianz
  • Calliden
  • CGU
  • QGE
  • Vero
  • Zurich

Of the insurers listed above, Calliden, CGU, QBE and Vero are all Australian owned and operated.

Allianz and Zurich are overseas companies (German and Swiss respectively) however they have both enjoyed a strong presence in Australia over many years and insure many local businesses.

As well as the insurance companies themselves, there are also an even larger number of underwriters providing cover throughout Australia.

The underwriting agencies generally specialise in areas where the mainstream insurers listed above do not. Often this involves business in high risk industries such as mining, aviation and many others.

For more information on some of the mainstream insurers please visit our Australian insurance providers guide.

Is it Compulsory in Australia?

There is some confusion out there whether or not public liability insurance is compulsory for business in Australia.

The short answer is no, however there are some business types that will have their own set of rules.

Many trades have mandatory public liability requirements, particularly those that must operate under a state government issued licence such as an electrical or plumbing contractor.

Some businesses may have also mandatory requirements set by their industry association or their landlord for example.

Generally these requirements are set in individual contracts rather than being required by any particular law.

Differences Between States

Generally speaking there are no differences between the public liability cover and requirements in the various states and territories of Australia.

There are some minor exceptions however, such as Qld electricians who require a special form of public liability insurance which includes consumer protection cover.

Plumbers in Victoria also have unique public liability requirements, as their policies must include a special extension for plumbers warranty cover.

Levels of Cover

In Australia the minimum about of public liability insurance available is $5 million. There is no set maximum limit, however for most standard business types the maximum will be $20 million.

Most insurers offer four main levels of cover as follows:

  • $5 million
  • $10 million
  • $20 million

For more information about how much cover your business requires please refer to our ‘how much is enough‘ guide.

How much will public liability insurance cost?

There are a number of factors which will influence the cost of your public liability insurance.  Our brokers will consider all aspects of your business to ensure you get the best value for money and don’t pay for coverage that’s not relevant to your activities.

Insurance is a critical element of your risk mitigation framework, so we strongly recommend you obtain professional advice from an insurance broker to ensure your business is adequately covered. When you apply for public liability insurance, we’ll need to know the following to give you an accurate quote:

  • The type of trade or occupation – ie electrician, plumber, etc.
  • The size of your business (by staff numbers or revenue) and your reliance on subcontractors.
  • How much cover you need (typically the cover is for $5M, $10M or $20M, etc).
  • Any high risk activities or work locations your business is exposed to.

Not only does public liability insurance make good business sense, it’s also tax deductible, as your insurance premiums are a business expense. You’ll receive a tax invoice at the end of each financial year, so you can claim the expense.

The factors outlined above will determine the cost of your public liability insurance. Here’s some more information about how and why each factor affects the price of your policy.

  • What business/occupation do you run?

The type of work your business performs has a level of risk attached to it. Some activities are more likely to cause injury or damage. The higher the risk, the higher the insurance premium. Our brokers have extensive knowledge of a wide range of industries. They’ll look at your industry and the types of claims made in the past, and factor this into your premium.

  • How big is your business?

Larger businesses attract larger premiums, as the risk of injury or damage is greater. We’ll look at the size of your business, taking into account your annual revenue and the number of employees you have, to present you with a competitive premium.

If you use subcontractors, this will also affect the cost. If a significant portion of your revenue goes towards paying subcontractors, your insurance will cost more. This is because a business owner tends to have less oversight of subcontractors (compared with company employees), so the risk of a claim being made is higher.  The use of subcontractors also creates greater legal complexity in the event of a public liability claim, so the premium cost takes this into account.

  • How much cover do you need?

You may be surprised to learn that the level of cover you need does not have a major impact on the cost of your premium. The minimum amount of cover is $5M. But if you decided to double your cover to $10M, your premium would increase but it would not double.

  • Where do you operate?

Our brokers will ask you about the locations you work in because this will have a big impact on the cost of your premium. Some locations such as mine sites, airports, large infrastructure projects and construction sites, are considered to be high risk. If your business is involved in a claim at a mine site or at an airport, the potential payout is likely to be significantly higher, compared with a claim by a home owner.

Whilst it might be tempting to downplay the level of risk your business is exposed to, in the long run this could mean an insurance claim is rejected due to a lack of full disclosure at the time the policy is taken out. Be sure to tell our broker everything about your business and the places you work in – and remember – your insurance premiums are tax deductible.

Are there some ways to keep the cost of my public liability insurance down?

We understand that money is tight. So whilst we always recommend adequate cover, there are still some strategies you might consider to minimise the cost of your public liability insurance. You could raise the level of your excess, reduce your benefit limit and look at package deals to cover all your insurance needs.

Of course, there are risks associated with increasing your excess or reducing your benefit limit so it’s important to get expert advice. Our brokers will help you find a policy that provides suitable coverage, for a competitive price.

What happens if you have no public liability insurance?

Most Australian States require businesses and other (non-domestic) occupiers of premises to carry Public Liability Insurance, particularly those that must operate under a state government issued licence such as an electrical or plumbing contractor. Some industry associations and landlords also have mandatory insurance requirements for their members and clients.

If your business doesn’t have adequate coverage, you run the risk of other businesses refusing to deal with you. You are also putting your business assets at risk if a claim is made against you that your premium does not fully cover.

It’s vital to get good advice when setting up your business insurance, including public liability, to ensure you are covered for any eventuality. You have worked hard to build your business so it makes sense to protect it with adequate public liability insurance.

Do I need public liability insurance if I am a sole trader?

A recent survey by the Insurance Council of Australia found 26 per cent of businesses have no form of general insurance. The most uninsured are sole traders, with 40 per cent of them operating with no coverage.

Whilst operating as a sole trader is a simple and easy business structure to manage, in the event of a public liability claim being made against your sole trading entity, your personal assets could be at risk without adequate public liability insurance. This is because you as a sole trader will be held personally liable for the claim. Essentially, there is no distinction made between your business and your private assets.

Your professional association can provide advice about the type of insurances recommended for your sole trader business. A lot will depend on the type of industry you operate in and the risks your business is exposed to. Having public liability insurance could not only protect your home and hard-earned assets, it could also ensure the continuation of your sole trading business if a claim is brought against you.

If your sole trading business is based in your home, you must immediately notify your insurer that your home is being used for business or commercial purposes.

You should clarify with your home’s insurer whether your home and contents insurance policies cover your business activities and assets in the event of accident, damage or loss. Some businesses may be able to cover the sole trading business as an extension of home insurance, while other business owners may need a public liability policy designed for their business.

Household insurance policies may exclude the legal liability that comes with operating a home business, a profession or use of your home as an office. Speak with your home and contents insurer or contact our broker to find out where you stand.

How long does it take to receive my Certificate of Currency?

Your Certificate of Currency can be emailed to you as soon as payment is made.  This document will provide evidence to third parties such as financial institutions and other companies you deal with that your business is adequately insured.

Can I purchase public liability insurance online?

We can provide an online quote for public liability insurance which will give you some guidance as to the costs involved. If you want to proceed with the insurance, we’ll have one of our brokers contact you to run through your insurance needs in more detail. This will ensure your public liability insurance policy addresses the unique aspects of your business and provides value for money.

Our brokers will need to know your trade or occupation; the size of your business (by staff numbers or revenue); whether you use subcontractors and if so, to what extent; how much cover you need (typically the cover is for $5M, $10M or $20M, etc); and any high risk activities or work locations your business is exposed to, such as working at a mine site or an airport.

Our broker can also discuss some strategies to minimise the cost of your public liability insurance. For example, you may wish to consider raising the level of your excess, reducing your benefit limit or looking at package deals to cover all your insurance needs, and reduce the overall cost of your insurance.

Our brokers have access to a wide range of insurance providers. They will help you find a policy that provides suitable coverage, for a competitive price.

More Information

Public liability is one of the most important forms of insurance than any business in Australia can have, and with the affordable cost for most business types there is really no excuse for not being covered.

It’s important to remember that public liability on its own won’t cover your business for every risk that it will face, but it can be packaged with a range of other covers to ensure you and your business are properly protected.

For more information about public liability insurance in Australia please speak with you insurance broker. If you do not already have one please contact us on 1300 542 245 and we will assist you.

You can also request a quote on your cover by completing our online quote request form.

Frequently Asked Questions

In some respects public liability insurance is very straightforward, but once you scratch the surface it can actually be a very complex area with many potential complications.

As part of our quest to make this important form of insurance easier for Australian small business owners and operators to understand we are in the process of putting together a list of the most commonly asked questions.

Please keep in mind that this FAQ contains very generalised answers and should in no way be seen or used as a substitute for proper advice from a qualified insurance broker or adviser.

If you would like to add a question to the list please contact us.

1. What does public liability cover?
2. How much does public liability cost?
3. Does it cover my staff and employees?
4. Does it cover my subcontractors?
5. Which companies issue public liability?
6. How does this website work?
7. Where is the website based?
8. How can I get a quote?
9. Can I pay my premiums monthly?
10. Do you provide insurance for tradesmen?
11. How much public liability do I need?
12. Does public liability cover defective work?
13. Are my professional services covered by public liability?
14. Are these differences in cover between policies?
15. What is an endorsement?
16. What is broadform liability insurance?
1. What does public liability cover?

Public liability insurance covers a range of risks, with the major ones being property damage and personal injuries caused to other people as a result of your business activities.

You can read more by visiting our ‘what is public liability insurance‘ page.

2. How much does public liability cost?

The cost of public liability can vary greatly from as little as $300 a year through to many thousands per year. The cost will depend heavily on the type and size of business that you run.

You can find out more by reading our public liability insurance cost page.

3. Does it cover my staff and employees?

A public liability policy will cover property damage and personal injury caused by your own staff and employees, but it will not cover property damage or personal injury that they suffer.

Personal injury to your staff can be covered by worker’s compensation and income protection insurance.

4. Does it cover my subcontractors?

Your public liability insurance will not cover your subcontractors in most cases. This includes damage caused by them as well as suffered by them.

There are some policies which may provide some cover, but these will generally be a far more expensive form of insurance. Subcontractors should have their own public liability and income protection in most cases.

5. Which companies issue public liability?

There are many insurance companies in Australia which offer public liability cover. These include the mainstream insurers like AAMI and NRMA, along with more specialist insurance providers.

The insurance brokers and advisers that we deal with will generally have access to a wide range of public liability insurance companies.

6. How does this website work?

The owners and operators of the publicliabilityinsurance.com.au website are not insurance brokers or advisers. We do not provide any quotes or advice ourselves, and instead we have a network of professionals that we refer people to when a quote is requested.

You can read more about how our website works by referring to our terms of use.

7. Where is the website based?

We are based in Brisbane, however we are able to assist business owners all over Australia. Our network of brokers and adviser are also based here in Brisbane as well as throughout the country.

8. How can I get a quote?

Getting a quote on your insurance is easy thanks to our online forms. In order to obtain a quote you simply have to provide your relevant business details and one of our network of brokers will prepare your quotes.

To obtain a quotation please complete our online quote request.

9. Can I pay my premiums monthly?

Public liability insurance can be paid monthly, however it is up to the individual broker or adviser to offer this service. Monthly premiums are generally arranged by an independent funding company rather than directly through the insurer.

In most cases it will be more expensive to pay your insurance monthly, but you can check this with your insurance broker or adviser when requesting quotes.

10. Do you provide insurance for tradesmen?

Our network on insurance brokers and advisers includes a number of experts on insurance for tradesmen. Tradesmen are actually one of our biggest client segments when it comes to public liability.

For more information please visit our dedicated tradesman public liability insurance section.

11. How much public liability do I need?

The amount of public liability insurance required will differ for each business, but in most cases the minimum is $5,000,000

If you require the cover as part of a specific contract you have entered into, generally the contract will stipulate the minimum amount of cover required.

Please visit our guide titled ‘how much is enough’ for more information.

12. Does public liability cover defective work?

Public liability insurance does cover defective or faulty work, however only certain costs are covered.

Property damage and personal injury suffered as a consequence on the defective work will be covered, however the costs of rectifying the defective work will not be covered.

For more information please visit our guide on defective work coverage.

13. Are my professional services covered by public liability?

A public liability policy is not designed cover losses relating to or as a result of the professional services or expert advice that you provide to clients.

You can still insure yourself against this risk however, through a separate form of cover known as professional indemnity insurance.

Click here for a more detailed answer to this question.

14. Are these differences in cover between policies?

Broadly speaking there is no difference in the basic cover offered by different public liability insurance policies.

All policies cover the costs involved in a claim against you for property damage or personal injury to another person that you are found to be liable for.

Where the policies can differ is in the exclusions and endorsements. The differences here can be huge depending on the type of business you run.

Click here for a more comprehensive answer to this question.

15. What is an endorsement?

An endorsement is a documented attachment to an insurance policy which can effectively change the standard wording of the policy.

They are generally used to either add or remove cover for a certain event or activity, and are often triggered by specific occupations or business types.

Endorsements can have a major impact in the event of a claim, so it’s important to check the endorsements before choosing a public liability policy.

Click here for a more comprehensive answer to this question.

16. What is broadform liability insurance?

Broadform liability simply refers to a business insurance policy which covers both public liability and product liability.

Most public liability policies will also cover product liability, essentially making the policy broadform, but this is not always the case.

By checking your policy documentation or asking your broker you will be able to see if your insurance is broadform or not.

Click here for a more comprehensive answer to this question.

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