Personal liability insurance vs Public liability insurance

Personal and public liability insurance policies are for the most part very similar in concept. There are however a few differences, most of which concern the context in which they are applied.  Here’s a guide to how they differ as well as the kinds of eventualities they can protect against.

Personal Liability Insurance

Personal liability insurance, also known as third-party insurance, provides coverage for injuries or property damage sustained by another person. Say for example, a house guest falls down the stairs of your home or cuts themselves on a fixture, personal liability coverage will cover any expenses incurred due to legal action. Damages as well as any medical bills to the injured person are also paid up to the agreed liability limit. This also applies if you or a member of your family accidentally damages a neighbor's property.  Personal liability cover therefore protects your assets, allowing you to transfer some of the financial risk resulting from such incidents to an insurance company.
Most homeowner or car insurance policies include basic personal liability coverage. While these don’t cover every type of eventuality they do protect individuals against a good number of claims. However, those wanting higher limits of liability coverage or broader protection, often opt for an umbrella insurance policy.

Public Liability Insurance

Despite the excellent coverage most personal liability insurance policies provide, they don’t usually extend to claims arising from a business or profession. This is where public liability insurance comes in. In its most basic terms, PLI, as it’s often known, is designed to protect you if members of the public make some sort of claim for an injury or stolen/damaged property which occurred at your business premises. While it is the duty of every business owner to create an environment which is as risk-free and safe as possible, there are times when accidents are unavoidable.
For example, if somebody was to enter your place of work and trip, breaking their arm, there’s a possibility that they would make a claim suggesting it was your fault for not keeping the floor in a safe condition. Your public liability insurance cover will then allow you to make a claim in order to cover any compensation or legal costs should the third party take the matter to court. While most policies are intended for incidents which take place at specific business premises, there are others types which can be extended to other locations. These are usually intended for companies that organise events.
Although some business owners don’t bother with public liability insurance, in most cases having such a policy in place is essential. This is particularly the case if members of the public, clients or customers visit your place of work, whether at home, a shop or another type of premises.

So in summary, personal and public liability insurance exist to protect both individuals and companies from the occasionally harsh realities of life. Although different in scope, each version can provide peace of mind while protecting one’s personal and professional assets against all manners of claims.