Does public liability insurance cover contractors?

What is covered by public liability insurance?

Public liability insurance provides cover for businesses and sole traders. It protects against any claims for damages arising from injury or damage caused to a member of the public or their property, because of work carried out by the business.

It is not a legal requirement, although some contracts, businesses, and trade associations do insist on it.

If a business comes into any contact with the public, cover is strongly recommended.

In this video, part of our Public Liability FAQ series, we answer the question ‘Does public liability insurance cover contractors?’.

Who is covered by public liability insurance?

The policy holder and their business will be covered. It relates to injury or damage caused in connection with the trade or business stated in the policy wording.

Cover usually extends to damage caused by directors, partners, or employees of the company. It may also include temporary staff, although you will need to check the terms of the individual policy about this.

If a claim is made against the employer by an employee for damage or injury caused to an employee, it will be covered under employers’ liability insurance.

A claim against the employer by a member of the public for damage or injury caused by an employee is covered by public liability insurance. 

Am I an ‘employee’ or a ‘contractor’?

Understanding whether you are an employee or contractor is not always straightforward. If you are in any doubt, you should take professional advice from your accountant or a solicitor.

Are my contractors covered? 

Your public liability insurance policy should cover contractors and subcontractors working for you. As a business using contractors, you should always check whether the contractor has their own public liability insurance and what level of cover they have. 

You should also double check that your policy covers contractors. Be sure to notify your insurance provider if you use contractors or subcontractors.

I am a contractor. Am I covered?

You should check whether the business you are contracting with has public liability insurance, and what level of cover they have. Remember: it is not a legal requirement to have such cover.

You should also check the terms of your contract, which may require you to have your own public liability insurance cover.

If you come into contact with the public for any reason, and often work as an independent contractor (either as a sole trader or by way of your own business) you should always consider having your own public liability insurance protection.