Importance of Product and Public Liability Insurance for Retail Businesses

As retail businesses have direct interaction with the general public (customers), they are more likely to face liability claims from the customers. Retail business owners may face liability when their business is held accountable for injuries caused to the visitors; even when the visitor’s property is damaged either due to the negligence of the store management or due to the defective product sold by the retail outlet. Hence, it becomes necessary for a retail business to have two important kinds of liability insurances – public liability insurance and product liability insurance - to survive in the marketplace.

In this article, we will see what these policies cover and how they are helpful for retail businesses.

Public liability insurance offers cover against claims made by third parties (general public/customers) who have suffered injury or damage to their property in the business premises. This insurance covers legal fees along with medical costs. But, it does not offer cover for the damage caused due to any product sold by the retail business. So, there arises a need for an insurance policy that protects retail businesses from claims involving defective products.

Product liability insurance protects the business from the claims related to the damage caused due to use of the defective product sold by the retailer. For instance, if the retailer sells a defective product to the customer that injures the person or causes damage to his property, then the claim resulted from this event comes under product liability insurance. All the costs and the compensations claimed by the injured third party will be covered by the policy, and hence reduces financial burden on the company.

Together, they make a comprehensive cover
When both public and the product liability insurances are covered in one policy it definitely makes a complete liability cover. It protects the business from all types of injury and damage claims which occur due to a defective product. Since there is an equal and significant chance of these two happenings in the retail environment, it is essential for businesses to get these two policies.

Tips to find best product and public liability insurance
These insurance policies are not similar for all the types of retail businesses. The amount of coverage depends on the level of risk faced by that particular type of retail business.

There are many insurance companies with lots of different policies in the market, making it difficult to choose the one which suits one’s business’ requirement. So, it is better to go for a brokerage firm. There are few insurance brokerage companies that tailor your policy as per your business requirements. Since they work with many insurance companies, they will help you get a suitable insurance policy at a discounted price. They will also help you in the renewal and claim process.

Having understood the importance of product and public liability insurance policies, it is recommended to get these policies for your retail business from reputed insurance brokerage firm.

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