Business Insurance

Why is Public Liability Insurance Important if You're Self Employed?

Public liability insurance can be a critical risk management tool if you're self employed. Here we explain why it is so important.

Accidents can happen at work, no matter how careful you are. If someone is injured or their property damaged and they blame you, you can be sued even if you're self employed. And without the protection of a company your personal assets can be at risk. This makes public liability insurance critical for many self-employed people.

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Here are three reasons why public liability insurance is so important for self-employed people. If you want to learn more, read our in-depth in-depth guide to public liability insurance or our piece on the different types of insurance if you're self employed.

1. Financial protection—for you and your business

Public liability insurance for self-employed people can protect their personal assets. Self-employed people can find themselves in a particularly vulnerable situation if they're sued, because without the protection of a company their personal assets may be at risk. Your savings, investments and even your home could be at stake if you're found liable to pay compensation and you don't have the right insurance in place.

So how does public liability insurance protect you financially?

"If you/your business are sued for personal injury or accidental damage due to your work, public liability (PL) insurance covers the legal costs to defend against the claim—it also pays any compensatory damages you're required to pay if you are found liable."

Personal injury and damage claims can cost thousands of pounds to defend, and even more in compensation. Without PL insurance a self employed person would be on the hook for paying these sums out of their own pocket. As a result, PL insurance can be a critical piece of business insurance coverage to protect not just your business but your personal finances.

Accidents can seemingly come out of nowhere. Here are a few examples of situations that could result in a lawsuit to illustrate how important public liability insurance can be for a self-employed person.


  • You work as a self-employed carer. One of the people in your care falls and is injured while you are helping them move between a wheelchair and bed.
  • You are a self-employed handyman. You installed a large television using wall anchors, but it broke free from the wall and fell shortly after installation. The TV broke, an expensive glass coffee table was shattered and the tile floor cracked. You claim on your handyman insurance when the client comes after you for damages.
  • You are a self-employed mobile hairdresser. A hair dye you are using accidentally tips over and stains a client's suede shoes and wall-to-wall carpet.
  • You are a self-employed gardener. You accidentally left a hose across a set of steps. You client slips on the hose, falling and breaking their arm.

2. It's good for business

Some clients expect you to have public liability insurance. Depending on what line of work you're in, clients might insist that you hold public liability insurance. In fact, they might not sign a contract or do business with you unless you provide proof that you're covered (e.g., the certificate of insurance).

In fact, you can include mention that you hold public liability insurance in the footer of your work emails, in any advertising and on your website to let potential customers know that you're covered. It can communicate that you take your business and the safety of your customers seriously, and that you're in business for the long haul.

3. Peace of mind

Public liability insurance is a safety net that can help you sleep at night. Those who are self employed are often running their own business. And as any business owner knows, there are a whole host of anxieties that come with being a small business owner—finding new customers, managing expenses, ensuring the quality of your work, hiring staff, managing risk, etc. If the thought of a personal injury or damage claim makes your stomach turn, getting the right self employed insurance can at least remove one of these worries leaving you to focus on the actual day-to-day running of your business.

For many people getting insurance sorted is a bit like getting your will done, in that it can linger on your to-do list for ages—but getting PL insurance is a heck of a lot simpler and can really be critical to ensuring your business doesn't turn into a financial disaster for you.

Yes, self-employed people need public liability insurance, notably if they have in-person contact with third parties or their property. Third parties are people not part of your business, such as customers, clients, vendors, landlords, passersby and other members of the public.

A self-employed person can get public liability insurance the same way as a company—for example by filling out a quote form with a business insurance comparison site. If you don't have a business name, then simply use your name when fulling out the application.

No, unlike employers' liability insurance, there are no laws requiring public liability per se. That said, public liability insurance may be a requirement of contracts you sign with business counterparts such as landlords, vendors, clients, etc.

Public liability insurance policies are typically structured for a specific line of work and to cover one business. If you own multiple businesses they will likely need different public liability insurance policies. This is because the risks will be priced differently for each business. You can contact your insurer to ask if they can insure multiple businesses, but expect to have separate policies for each business.

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Erin Yurday

Erin Yurday is the Founder and Editor of NimbleFins. Prior to NimbleFins, she worked as an investment professional and as the finance expert in Stanford University's Graduate School of Business case writing team. Read more on LinkedIn.