You can determine the amount of public liability insurance you require by the type of work you do and whether or not your clients expect a certain level of protection.

Coverage limits for public liability insurance are $1 million, $2 million, or $5 million. The maximum amount your insurer will payout in the event of an insurable claim is the cover level.

What is Public Liability Insurance?

Public Liability Insurance is also known as Public and Products Liability Insurance. It protects your company when a company member is injured, or their property damaged due to dealing with your company or products.

Public Liability Insurance pays for any legal settlements you may be liable to pay. In addition, any reasonable legal fees you may incur in defending a claim against you.

Is public liability insurance compulsory in Australia?

Australian law does not require public liability insurance. However, according to the Australian Government, “If you own a business, you may be liable for damages or injuries to another person or property.”

Although liability insurance is usually optional, it is strongly recommended for businesses in all industries so no one can sue them Public liability insurance safeguards you and your company from the financial consequences of being held liable for ‘Negligence’. You can define Negligence as “harm that is reasonably foreseeable.”

How do you know which amount is best?

The amount of insurance you’ll need will vary depending on your company’s needs.

While a small home-based business may be okay with a $5 million policy, a large company with more significant risks may require $20 million or more in coverage.

The contracts you sign frequently determine the amount of coverage you need.

Suppose your company works in shopping malls. Then the contract will almost always require public liability coverage of at least $20 million. Many government contracts are the same way.


Still confused? Contact our Canberra Public Liability Lawyers.


It also depends upon the following factors:

Level of Communication with the general public:

If your company regularly interacts with the general public, you’ll need more insurance. If you own a public-facing business like a cafe, restaurant, or shop, or if you run a plumbing or electrical company that requires you and your employees to visit people’s homes regularly.

Then you are likely to have a high-risk public liability profile, necessitating a more comprehensive public liability policy. For example, if you deal with clients and customers online over the phone, you will be at low risk and require less coverage.

Previous claims:

The amount of public liability insurance your company requires, as well as how much you can expect to pay for your policy, may be determined by your previous claims history, just as it is with any other type of insurance policy.

If you’ve ever had to file a public liability claim, this tells your provider that you’re a higher risk. This will reflect in the size of your insurance premium.

Trade bodies and associations:

Suppose your company operates in a heavily regulated industry. Then you need to check to see if there are any guidelines on how much public liability insurance you’ll need.

Some trading authorities and other organizations, in addition to policies, require that you have a certain level of insurance to be a member. For example, to be a member of the Association of Plumbing and Heating Contractors, your company must have public liability coverage worth at least $2 million.

Contract details:

Sometimes, you overlook the specific public liability requirements with your clients. Some of the clients you work with will demand a certain level of coverage from all of the businesses with which they do business. You will explain everything related to public liability in detail in your contract. This is typical of agencies that work with a diverse client base.


For our legal support services, contact us at (02) 6295 228

United Legal

Canberra Public Liability Lawyers 

Visit us at

54-56 Townsville St, Fyshwick ACT 2609

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