Self-Employed or Side Hustle? Why You Risk Bankruptcy Without 'Public Liability Insurance'
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| Self-Employed or Side Hustle? |
You have started a small side business. Maybe you are a private tutor visiting students' homes, a freelance photographer, a dog walker, or you sell handmade crafts at a Sunday market.
You think, "I'm just a small fish. I don't need business insurance."
This is a dangerous myth. In the UK's litigious culture, "Where there's blame, there's a claim." One small accident could result in a lawsuit for £10,000, £50,000, or even millions.
This is where Public Liability Insurance (PL) comes in. It is surprisingly affordable, yet it stands between you and financial ruin.
What Does It Actually Cover?
Public Liability Insurance protects you against claims made by members of the public (clients, passersby, customers) for:
1. Injury to a Person
You are a cleaner mopping a floor. A client walks in, slips on the wet floor, and breaks their hip. They sue you for pain, suffering, and lost earnings. PL covers the huge compensation bill and legal fees.
2. Damage to Property
You are a tutor or IT consultant working at a client's house. You accidentally knock over a vase or spill coffee on their expensive MacBook Pro. PL pays for the replacement.
3. Products Liability (Crucial for Sellers)
If you sell cakes or crafts, standard PL covers trips and falls. But Products Liability (usually bundled with PL) covers you if your cake gives someone food poisoning or your handmade jewellery causes an allergic reaction.
Who Needs It? (Almost Everyone)
You might be surprised at who is at risk. It is not just for builders and plumbers.
- Tradespeople: Electricians, Plumbers, Carpenters (Essential).
- Service Providers: Cleaners, Gardeners, Dog Walkers.
- Freelancers: Photographers (tripod hazard!), Tutors, Mobile Hairdressers.
- Event Sellers: Stalls at Christmas markets or food fairs (Organizers often require proof of PL).
How Much Cover Do You Need?
When you buy a policy, you choose a "Limit of Indemnity"—the maximum amount the insurer will pay for one claim.
- £1 Million: The minimum standard. Good for very small, low-risk businesses.
- £2 Million to £5 Million: Most Local Councils and market organizers now insist on £5 Million cover if you want to trade on their premises.
- £10 Million: Usually required if you work for large corporate clients or government contracts (e.g., NHS).
💰 Is It Expensive?
Surprisingly, no. For a low-risk business like a tutor or photographer, premiums typically start from £50 to £80 per year (approx. £5-£7 a month).
Compare that to the cost of a single legal letter from a solicitor (£500+), and it is a no-brainer.
⚠️ Legal Warning: Employers' Liability
This is where people break the law.
Public Liability is optional (though recommended). But if you hire anyone to help you (even a temp, an intern, or a friend you pay cash in hand), you are legally required to have Employers' Liability Insurance.
If you don't have it, the HSE can fine you £2,500 for every day you are uninsured. If you are strictly a "one-person band," you don't need this.
Build Trust, Win Clients
Having Public Liability Insurance isn't just about protection; it is about Professionalism.
When you tell a potential client, "Don't worry, I am fully insured," it proves you take your job seriously. It is a powerful trust signal that wins you more business.
Don't risk your house and savings for the sake of £6 a month. Get a quote today.
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