What Is Public & Product Liability Insurance?

Public and Products Liability Insurance combines two important types of commercial insurance protection.

Public Liability Insurance generally protects against certain legal liabilities arising from injury to third parties or damage to their property in connection with your business activities.

Products Liability Insurance generally protects against certain legal liabilities arising from injury or property damage caused by products your business manufactures, imports, distributes or supplies.

These covers are frequently arranged together, but each responds to different types of claims. The exact scope depends on the policy wording, limits and exclusions.

What Does Public & Product Liability Insurance Cover?

Public Liability vs Products Liability: What’s the Difference?

Although these covers are often included within the same policy, the distinction is important.

Public Liability Claim Example

A customer visits your business premises and trips over an obstruction, suffering an injury. They allege that your business was negligent and pursue a compensation claim.

Subject to the circumstances and policy wording, the Public Liability section may respond.

Products Liability Claim Example

Your business supplies an electrical product that allegedly develops a fault and causes a fire, damaging a customer’s property.

Subject to the circumstances and policy wording, the Products Liability section may respond.

The key distinction is whether the alleged liability arises from your business operations or from a product you have supplied.

Who Needs Combined Public and Products Liability Insurance?

Combined cover can be particularly relevant to businesses that interact with customers or third parties and also supply goods or products.

Products Liability: You Don’t Have to Be the Manufacturer

Products Liability Insurance is not just relevant to businesses that manufacture goods.

Retailers, distributors, importers and businesses selling products under their own brand may also face product-related claims.

Particular considerations include situations where your business:

• Imports products from outside the UK.
• Supplies goods under its own brand or trademark.
• Modifies, repairs or alters products before resale.
• Cannot identify the original manufacturer or producer.
• Supplies products used in safety-critical applications.
• Exports products to overseas customers.

The legal responsibilities of each business in a supply chain depend on the circumstances and applicable law. Insurance arrangements should reflect your actual role and trading territories.

What Liability Insurance Limits Should You Consider?

Common Public Liability limits include £1 million, £2 million, £5 million and £10 million, although other limits may be available.

The appropriate limit depends on your business activities, potential claim severity and contractual obligations.

For Products Liability, insurers may apply an aggregate limit for all claims during the policy period, rather than a separate full limit for each claim.

It is important to understand whether Public and Products Liability share a limit, have separate limits or are subject to different policy conditions.

Businesses supplying higher-risk products or trading internationally may require specialist underwriting.

Important Exclusions and Restrictions

Combined Public and Products Liability Insurance does not protect against every possible business loss.

Common exclusions or restrictions may include:

• Injury to employees, which normally requires Employers’ Liability Insurance.
• Professional advice, design errors or financial losses without appropriate cover.
• The cost of repairing or replacing your own defective product.
• Product recall, withdrawal and replacement costs unless specifically insured.
• Damage to property in your care, custody or control.
• Damage to the particular part of property being worked upon.
• Contractual liabilities extending beyond the insured legal liability.
• Pollution and contamination, except where the policy expressly provides cover.
• Products supplied to excluded industries or applications.
• Claims arising in excluded countries or jurisdictions.
• Deliberate acts and other excluded circumstances.

Some restrictions may be addressed through specialist extensions or separate insurance policies. Always review the actual policy wording and endorsements.

Public & Product Liability Insurance for Specialist Businesses

Some industries require additional attention because of the nature of their work or the products they supply.

Examples include engineering, manufacturing, construction, chemical products, imported goods and safety-critical components.

Insurers may need detailed information about:

• The products manufactured, sold or distributed.
• Product testing and quality control procedures.
• Relevant product standards and certifications.
• Product traceability and recall arrangements.
• Installation and maintenance responsibilities.
• Export destinations and overseas sales.
• Previous incidents and claims.

Edison Ives can help present these risks to appropriate insurance markets and explain the terms offered.

How Much Does Public & Product Liability Insurance Cost?

Premiums depend on the nature and scale of your business and the liability exposures involved.

What to Do if You Receive a Liability Claim

Public and Products Liability claims should be reported promptly in accordance with your insurance policy’s notification requirements.

• Notify your broker or insurer: Report incidents that could lead to a claim without unnecessary delay.
• Preserve evidence: Retain photographs, incident reports, CCTV footage and relevant correspondence.
• Record witness details: Obtain names and contact information where possible.
• Preserve relevant products: Keep products, packaging and associated records where safe and appropriate.
• Forward legal documents: Send letters of claim and court papers to your insurer or broker immediately.
• Avoid admitting liability: Do not agree compensation or make admissions without the insurer’s consent.
• Cooperate with investigations: Provide requested information and keep your insurer informed of developments.

Claims procedures and insurer requirements vary. Always follow your specific policy conditions.

Frequently Asked Questions

Can Public and Products Liability Insurance be arranged together?

Yes. Many commercial insurance policies include both covers, although the limits, exclusions and conditions may differ.

Is Public & Product Liability Insurance compulsory?

Neither cover is universally compulsory for all UK businesses. However, certain contracts, clients or industry arrangements may require them.

Does Products Liability Insurance cover product recalls?

Not automatically. Product recall expenses typically require specific cover, which may be available through a separate policy or extension.

Does Public Liability Insurance cover my employees?

Public Liability Insurance does not normally cover employee injury claims. Employers’ Liability Insurance is generally required for businesses employing staff, subject to legal exemptions.

Can importers obtain Products Liability Insurance?

Yes, subject to insurer acceptance. Importers should disclose product types, countries of origin, supply arrangements and sales territories.

Does the policy cover products exported overseas?

Cover depends on the policy’s territorial and jurisdictional limits. Exports, particularly to the USA or Canada, may require specific insurer agreement.

Why Choose Edison Ives?

At Edison Ives, we understand that businesses can face liability exposures from both their day-to-day operations and the products they supply.

We aim to understand your activities and help you explore insurance that reflects the risks involved.

• Personal advice from commercial insurance brokers.
• Support with combined Public and Products Liability requirements.
• Consideration of specialist trades and product exposures.
• Help understanding limits, exclusions and endorsements.
• Assistance with insurance arrangements for businesses with complex requirements.

Part of David Roberts & Partners

Edison Ives is proud to be part of David Roberts & Partners Ltd, an independent insurance broker group.

Our group relationship supports access to wider insurance expertise and markets while allowing us to maintain a personal approach to our clients.

For more detailed information, explore our individual Public Liability Insurance and Products Liability Insurance pages.

Contact Edison Ives

Call 0113 390 4646

Email info@edinsure.co.uk