The self-employed guide to public liability insurance (and when it matters)

Public liability insurance will protect you if your business causes injury to a member of the public or damage to someone else’s property.

It’s worth considering if clients or members of the public visit you at your home, or if you work at other people’s sites — including offices, shops, or private homes.

Public liability insurance – what does it cover?

A public liability insurance policy will cover claims made by third parties for injury or damage caused as a result of your business activities.

A typical policy will pay for the cost of rectifying any damage or medical fees in the event of an injury. It also covers the potentially crippling costs of legal representation, related expenses, and any damages you are found to owe in relation to a claim.

Who should consider this type of cover?

• If you work from home but have clients visiting you for professional reasons.
• If you run a market stall, pop-up shop, or take part in markets and fairs.
• If you regularly visit clients’ sites, offices, or homes to do your work.

Having public liability insurance is not only a safeguard for sole traders, but it can also give clients confidence. Many will prefer – or even insist – that you have adequate insurance in place before they’ll hire you.

It might be mandatory in some cases

For certain trades, public liability cover isn’t optional. For example, many local councils require market traders to have insurance before setting up a stall. Similarly, some corporate and government contracts list it as a condition of work.

It doesn’t cover claims from your own employees

Public liability insurance does not cover claims made by your employees, contractors, or apprentices. If you employ anyone, you must have employers’ liability insurance. The penalties for not having it are severe.

Examples of public liability insurance claims

Here are some scenarios where public liability cover could protect a sole trader:

• A self-employed IT support worker visits a client site. He accidentally spills coffee on the main server, causing permanent damage.
• An electrician re-wires a property but doesn’t fit the fuse box correctly. Several circuits burn out as a result.
• A customer trips over boxes in your shop or stall. The policy would cover the cost of treating the injury.

How much cover do you need?

Policies usually start at £1 million and can be bought in higher increments of £5 million or £10 million. You may be required to take out a certain level of cover if you work with local authorities or large organisations.

Otherwise, it’s up to you to choose the level that feels sensible for your trade.

Many insurers sell public liability as part of a bundle with employers’ liability and professional indemnity insurance. Buying a package is often cheaper than arranging separate policies.

For a full overview of cover options, see our guide to sole trader insurance.

How much does it cost?

The cost will depend on several factors that are specific to your trade, such as:

• The type of work you do.
• Whether you employ anyone.
• Your previous claims history.

For many sole traders, public liability cover is very affordable. Premiums often start at £50–£100 per year.

Costs will rise with the level of cover and the risks associated with your work. If you need £5 million or more, expect to pay more.

Get a public liability insurance quote – from £4.58 per month!

Try our trusted insurance partner Qdos. They offer tailored public liability insurance specifically designed for the self-employed, ideal for sole traders and limited companies.

We’ve worked with them for over 15 years and also use them for our own insurance at ByteStart.

FAQs on public liability insurance for sole traders

Do sole traders legally need public liability insurance?

No, it isn’t a legal requirement for self-employed people. However, some clients, landlords, or local authorities may insist on it before you can trade. Market stalls are a common example – see our guide on selling at markets and fairs. See also our guide aimed at tradespeople.

How is public liability different from professional indemnity insurance?

Public liability protects against injury or damage claims made by third parties, while professional indemnity insurance covers you if a client claims your advice or professional services caused them a financial loss. Many sole traders take out both.

Can I include public liability cover in a wider policy?

Yes. It’s common to buy public liability as part of a bundle that also includes employers’ liability and professional indemnity. Bundling often works out cheaper, and you’ll find the main options explained in our sole trader insurance guide.