How do I know how much liability insurance I need?
Determining the right amount of liability insurance depends on your industry risk, business size, client requirements, and potential for causing injury or property damage. Most businesses start with at least £1 million to £2 million, but high-risk sectors (construction, manufacturing) or those working with government bodies often require £5 million to £10 million or more.
Whilst a small home based business may be quite safe with a $5 million policy, a large business with more substantial risks may require cover of $20 million or more.
Levels of public liability cover vary and the amount you need depends on the type of work you do and the area in which you operate. For example, if you are a plumber and only work in private houses £1m or £2m may be more than enough.
Small businesses pay an average premium of $45 per month for general liability insurance. Annual policy costs range from around $250 to over $3,000 per year, depending on certain factors about your business.
Does my small business need public liability insurance?
Is Public Liability a legal requirement? Public Liability insurance is not a requirement by law, but many clients will insist that you're covered for public liability before allowing you to begin work. Some trade associations will not allow you to register with them unless you have a valid liability policy.
Liability coverage in your car insurance policy pays for property damage and/or injuries to another person caused by an accident in which you're at fault. This type of auto coverage is required by most states to legally drive your vehicle.
What happens if I don't have public liability insurance?
Operating without public liability insurance can result in severe legal ramifications, even if it isn't a legal requirement to have this type of cover. Not having this insurance can lead to lawsuits, legal fees and significant compensation costs.
All businesses need public liability insurance as they are bound to be in contact with clients, customers, or the public at some point. Public liability insurance protects you from third-party claims of accidental damage or injury resulting from your business activities.
Can you run a business without business insurance?
For most limited companies that have employees, or have more than one director, employers' liability insurance is a legal requirement. If you're the sole director of a limited company, you don't necessarily need to have it in place, but some companies may require you to have a policy in order to work for them.
Sole trader businesses have 'unlimited liability' which means owners are personally responsible for all of the debts of the business. If something goes wrong, you will have less protection. You may be able to get more protection with business insurance.
How much is public liability insurance for self-employed?
*The price is for up to £2 million of public liability insurance – 10% of customers paid £67.72 or less annually between 1st Jul – 31st Dec 2025. Equivalent to £5.64 a month (and excludes the extra costs for paying monthly). 84% of customers have a £1 million limit and 16% £2 million.
How much is public liability insurance for a sole trader?
A public liability policy could cost less than $500 for a sole trader needing the minimum cover, through to $100,000+ for a much larger or higher-risk trade businesses. Click the button below for a quote, or keep scrolling to read our public liability cost guide.
With general liability, premiums can depend on several things—your payroll, sales, building size, and sometimes flat fees. Since these factors change from year to year, the audit is a way to make adjustments. If your business grows, you'll probably owe more because there's more risk to cover.
The cost of a $1 million general liability insurance policy for small business owners typically ranges from $300 to over $2,000 annually, depending on several risk factors. The median cost is $42 per month.
Do I really need professional liability insurance?
If your business offers professional services or advice to customers, you'll need professional liability insurance. Some types of businesses that can benefit from this coverage include: Accounting firms. Consulting agencies.
Preventable risks that lead to third-party bodily injury or property damage claims are excluded under general liability coverage. So, if a customer slips on the icy steps outside your store because you didn't put salt or sand down, the claim wouldn't be covered.
This article outlines the “Five P's of Insurance” that I discuss with my clients when designing group benefits plans. The five “P's” include premium, plan, providers, participation, and performance. Consider these five elements of benefits design and rank them by importance.
The 3 D's of insurance are “delay, deny, and defend.” They represent the 3-part strategy insurance companies use to avoid paying policyholders what they may be owed. These tactics may pressure some Americans into accepting lowball settlements, and they can result in claims being held up in court for years.
There are many types of insurance available, but there are some which top the charts in terms of importance. Home or property insurance, life insurance, disability insurance, health insurance, and automobile insurance are five types that everyone should have.
