{"id":910,"date":"2024-10-11T13:49:48","date_gmt":"2024-10-11T12:49:48","guid":{"rendered":"http:\/\/www.policybee.co.uk\/blog\/?p=910"},"modified":"2025-08-18T11:38:49","modified_gmt":"2025-08-18T10:38:49","slug":"professional-indemnity-or-public-liability-insurance","status":"publish","type":"post","link":"https:\/\/www.policybee.co.uk\/blog\/professional-indemnity-or-public-liability-insurance","title":{"rendered":"Professional indemnity or public liability insurance? Do you need both?"},"content":{"rendered":"\n

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Time to answer a very common question: should you get professional indemnity (PI) insurance or public liability (PL) insurance? Or do you need both?<\/p>\n\n\n\n

Well, they’re kind of similar in the way they both cover claims of negligence<\/a> against you or your business.<\/p>\n\n\n\n

But it\u2019s the type<\/em> of negligence that makes the difference. It dictates which of the two policies kicks in when there’s a claim. Here\u2019s what’s what.<\/p>\n\n\n\n

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PI vs PL: key differences<\/strong><\/h2>\n\n\n\n

Before we dive into the nitty gritty, it\u2019s important to get a basic understanding of the differences between professional indemnity and public liability insurance. Here\u2019s a table that should act as a good starting point:<\/p>\n\n\n

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What professional indemnity (PI) insurance covers<\/strong><\/h2>\n\n\n\n

Professional indemnity insurance<\/a> protects you against claims made by clients unhappy with your work. It’s essential for anyone providing a professional service such as giving advice, designing things, or completing specialist tasks.<\/p>\n\n\n\n

If a client alleges you\u2019ve made a mistake or been negligent, a professional indemnity policy covers the considerable legal costs of defending you \u2013 whether the claim is valid or not. <\/p>\n\n\n\n

If you are<\/em> in the wrong, your insurer also pays any damages, awards, rectification costs, or compensation you’re liable for \u2013 up to your policy’s level of cover.<\/p>\n\n\n\n

As well as negligence, professional indemnity insurance can also cover claims concerning defamation, if you’re accused of intellectual property and copyright infringement<\/a>, and the dishonesty of your employees, partners, or directors.<\/p>\n\n\n\n

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What public liability (PL) insurance covers<\/strong><\/h2>\n\n\n\n

Public liability insurance<\/a> covers your business against third-party claims for injuries or property damage said to be your fault. <\/p>\n\n\n\n

If visitors come to your work premises, or you go out and about and there\u2019s an accident, you could be liable. Say someone trips over a cable in your office and falls, breaking a shoulder and smashing their expensive watch in the process.<\/p>\n\n\n\n

Claims can be either for the cost of repairing or replacing damaged property or for compensating an injured person \u2013 or both.<\/p>\n\n\n\n

Public liability insurance pays your legal costs as well as any damages, repair bills, or compensation you\u2019re liable for.<\/p>\n\n\n\n

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Do I need both?<\/strong><\/h2>\n\n\n\n

It depends on the nature of your business. You\u2019ll need professional indemnity if clients hire you for your professional services. And public liability will be important if those clients visit your premises. Or you visit theirs.<\/p>\n\n\n\n

A couple of simple examples might help. Let\u2019s say you\u2019re an accountant. You work with clients, but you only ever see them virtually. You\u2019d need PI to cover any potential professional mistakes, but as you don\u2019t visit clients and they don\u2019t visit you, you probably wouldn\u2019t need PL.<\/p>\n\n\n\n

On the other hand, you might own a caf\u00e9. As you don\u2019t provide any professional services, PI probably isn\u2019t suitable for you. But you\u2019d need PL because customers visit your premises every day.<\/p>\n\n\n\n

Every business is unique. So, whether or not you need both PI and PL depends on what your business does and how.<\/p>\n\n\n\n

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Professional indemnity and public liability insurance cover limits<\/strong><\/h2>\n\n\n\n

When you buy professional indemnity or public liability insurance, you\u2019ll be faced with a choice of which cover limit you should choose. You can choose from a variety of different limits, but which one should you choose and why?<\/p>\n\n\n\n

We\u2019re going to sound bit like a broken record here, but it depends on the nature of your business.<\/p>\n\n\n\n

Let\u2019s start with PI. The cover limit you need will depend on a few things:<\/p>\n\n\n\n