When should I buy public and product liability insurance?

Public liability insurance is a must-have for those businesses which are exposed to the greatest risk of being sued for injuries or damages that occur on their premises or losses arising out of the company's operations.

If your company's area of business and primary service involves manufacturing, selling or distributing products, then you should get product liability insurance to protect you in the event that somebody is injured due to potential defects in the product.

When Buy Public Liability Insurance

Some businesses, especially those involving recreational services and drinking, such as casinos, bars and clubs, are exposed to substantial risk of being sued as a result of injuries or property damage incurred by their customers on the premises.

Therefore, if you own a high-risk business like the ones mentioned above, you should make sure you get substantial protection against public liability claims.

Buying Commercial General Liability (CGL) insurance can help you recover financially in the potential event that you are found guilty of public liability and have to pay compensation to the injured party. Under a public liability insurance policy, you are financially protected against claims of premises and operations liability, personal and advertising liability, fire damage liability.

Product Liability Insurance - Is It For Me?

If you think you run the risk of being held legally liable for injuries or damages caused by defects in the products your company designs, manufactures, sells or distributes, then you'd be better off buying product liability insurance. The products can be commodities, pets, real estate, or intangibles, such as gas.

Under the law of strict liability, if a loss is directly caused by the products your company is in charge of, you can be held liable, regardless of negligence or fault. That is to say, no matter whether you have taken all the safety measures, if an accident occurs due to the defects in the product, you will be sued by the injured party and will most probably have to pay damages if the product is proven to be defective in court.

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