Liability insurance protects an individual or their business against any property damaged or injury caused to a person.
It must be established that with Liability Insurance there is negligence involved on the individual or business’ part, as they did not take reasonable steps to ensure safety and care to others.
Liability Insurance is generally a mandatory cover required in the event of setting up a business, contracting work, or is imposed upon by a third party, i.e. landlord, contractor etc. For example, when you take out a lease, there will generally be an imposition from your landlord to have liability cover for a certain amount. This is well worth checking on your lease, as failure to take out the cover or not the amount required, may make you become liable for any damage that the property may have sustained, and therefore a personal cost to the individual and/or their business.
The following is an example of such:
ABC Company Pty Ltd takes out a commercial lease within an office building. The commercial lease is made up of an office and a number of car spaces within the complex. ABC’s client visits the office for a business meeting and parks his vehicle in one of the two allocated car spots. At the conclusion of the meeting, which by now is in the evening, ABC’s client, upon returning to his vehicle, slips and injures himself. This due to the fact that the car park lights were not functioning in the area. This is deemed as negligence on ABC’s part, as under the terms of their lease they are responsible for the car spaces. ABC’s client could then seek damages against ABC Company Pty Ltd, as they have failed in their duty of care to provide a safe environment.
Liabilities exist in two forms: Public, Injury to Others, or Property Damage and Products. The latter includes products that you have manufactured or imported (Australian Jurisdiction states - if you import a product, you are deemed the manufacturer) and are therefore liable if that product causes injury to others or property damage.
A common example is providing food that causes a salmonella infection. This is incredibly serious and can result in fatal consequences. Another example is toy manufacturing. It is the manufacturers’ responsibility that the toy is safe, tested and complies with Australian standards. Failure to comply may result in personal injury and again fatal consequences. Furthermore, insurers will either not insure or apply restrictions on cover if this is not adhered to.
If you have any concerns about Liability Insurance, please contact the team at Peter Vickers Insurance Brokers on:
1300 784 011 or firstname.lastname@example.org