Discover the difference between professional indemnity and public liability insurance. In this guide, we will define what PL and PI are and provide clear examples to help distinguish the difference between them. By the end, you will have a good idea on whether your business needs indemnity and public liability insurance, and to what extent.
Public liability insurance covers you against material damage (i.e. product, equipment, property, etc.) and injury claims that result from negligence on behalf of you or one of your employees. If a third party experiences property damage, bodily injury, or is killed while completing your work, PL insurance can help you cover the cost of the claim as well as court and legal fees (depending on the terms of your policy). That's why it is often referred to as third-party insurance. To find out more, see our guide to public liability insurance.
Public liability insurance is especially important for businesses that work with physical products or directly interact with the public, such as tradesmen and manufacturing companies. That said, many businesses will not work with you unless you can show them proof of public liability insurance, making it a valuable asset for most businesses. Those who manufacture products or sell food should also consider products liability insurance which covers businesses against damage caused to their customers or their property by defective or dangerous products.
Professional indemnity insurance is essential for businesses such as professional consultants, architects, lawyers, accountants, digital agencies, software developers, business analysts, and marketing companies. However, even tradesmen will want Professional Indemnity Insurance to cover accidental loss of sensitive documentation, information leaks and the risk of giving poor advice.
We can cover both public liability insurance and professional indemnity insurance in a package under the title of professional liability insurance, which also includes libel and slander coverage and product liability coverage. Our policy also protects businesses that work from home within the UK.
Date: April 18, 2016