General Liability Insurance Australia: What It Covers & Why It Matters

Being a business owner in Australia brings along its own set of duties. From overseeing day-to-day activities to dealing with customers, you will be kept busy. But when unforeseen events happen such as a client slipping at your store or damaging someone’s property by accident, these may result in financial losses in terms of compensation and lawsuits. 

What is General Liability Insurance?
Liability Insurance can be useful for your business if you become subject to a claim from a third party who has suffered an injury or damage to their property because of your business activities.
Example:
● A client slips in your shop and gets injured 
● You accidentally damage a client’s property when carrying out a service 

Why General Liability Insurance Matters
Even the smallest events can lead to huge costs being incurred. Legal fees and compensation can be high, especially when injuries are involved. With General Liability Insurance, you will be able to manage the financial implications of such claims and allow your company to handle unforeseen circumstances effectively. Although, general liability insurance is not legally mandatory for all business in Australia, but it is effectively compulsory for many due to licensing requirements, contractual obligations or site access rules. 

Types of General liability:
   ● Public Liability – Insures for events caused by your operations 

   ● Product Liability – Insures for cases involving products that you produce, sell, or provide
   ● Property care custody and control:
       In your care – you are responsible for it temporarily 
       In your custody – it is physically with you  
       Under your control – you have authority or supervision over it 

• What Does General Liability Insurance Cover?

  Scenarios Generally Covered Under General Liability Insurance 
  
  

  Scenario	Why It Is Covered
  A customer slips on a wet floor in a shop	Third-party bodily injury caused by business negligence
  A contractor accidentally damages a client’s wall	Accidental third-party property damage
  A plumber leaves tools on-site and someone trips	Negligence causing third-party injury
  A visitor suffers food poisoning at a restaurant	Bodily injury linked to business activities
  A gym member is injured due to staff negligence	Third-party injury arising from negligence
  Theft of a customer’s property from premises	May be covered under property care and custody depending on the policy wording

   

  Scenarios Generally NOT Covered Under General Liability Insurance 
  
  

  Scenario	Why It Is Not Covered
  A product sold causes injury after purchase	Usually covered under Product Liability
  A business vehicle causes a road accident	Covered under Commercial Motor or CTP Insurance
  A business owner intentionally damages property	Intentional/criminal acts are excluded
  Customer data is leaked during a cyberattack	Requires Cyber Insurance
  Incorrect professional advice causes financial loss	Covered under Professional Indemnity Insurance
  Employee gets injured at work	Covered under workers compensation insurance for each state.

  
  Also Read: Your Guide to Public Liability Insurance Brokers
  
  

  How can your premium be affected?

  The price of insurance may differ based on the following:
     ● The nature of your occupation and your activities.
     ● Your company’s turnover.
     ● The location of your company (if the location is in high-risk area) 

  A busy cafe will be at a greater risk than a regular office environment. 
  
  

  Do Self-Employed Businesses Need It?

  Yes, many self-employed individuals opt for General Liability Insurance.  

  In case you: 

•    ● Interact with your clients personally
     ● Work at their place.
     ● Offer your services.
  Then there is always a chance of a claim against you. 

Conclusion
General Liability Insurance is one of the important types of insurance for most Australian companies and it is viewed as an essential element in managing any kind of business risk. 
At Auswide Insurance, we understand that every business is unique, and your insurance coverage should be tailored to suit your specific needs. It is important to review your policy regularly and update it as required to ensure your business remains adequately protected and properly insured.