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Scope and Cover

This policy covers the amount which the insured becomes legally liable to pay as damages to third parties as a result of accidental death, bodily injury, loss or damage to the property belonging to a third party. The legal cost and expenses incurred in defending the case with prior consent of the insurance company are also payable subject to certain terms and conditions.

You can insure more than one unit situated in different locations under a single policy.

The policy offers a benefit of Retroactive period on continuous renewal of policy whereby claims reported in subsequent renewal but pertaining to earlier period after first inception of the policy, also become payable.

Who can take the policy?

The policy can be taken by the manufacturer of any product whether it be the final product or part of the final product.

  • Public Liability Non Industrial Risk - For offices,hotels, cinema houses,hospitals, schools etc.
  • Public Liability Industrial Risk - For godowns , warehouses and factories.
  • Public Liability Insurance Act 1991 - This is a mandatory policy to be taken by owners ,users or transporters of hazardous substance as defined under Environment (Protection) Act 1986 in excess of the minimum quantity specified under the Public Liability Insurance Act 1991.

Add on Covers

The Public Liability Policy can be extended to cover the following risks on payment of an additional premium.

  • Natural calamities like flood, earthquake etc.
  • Pollution Risk subject to NOC from Pollution Control Board
  • Transportation Risk

Sum insured

In public liability policy, the sum insured is referred to as Limit of Indemnity. This limit is fixed per accident and per policy period which is called Any One Accident (AOA) limit and Any One Year (AOY) limit respectively. The ratio of AOA limit to AOY limit can be chosen from the following:

  • a. 1:1
  • b. 1:2
  • d. 1:3
  • d. 1:4

The AOA limit which is the maximum amount payable for each accident should be fixed taking into account the nature of activity of the insured and the maximum number of people who could be affected and maximum property damage that could occur, in the worst possible accident in the insured's premises.

In the case of Public Liability Insurance Act 1991, the AOA limit should represent the paid up capital of the company subject to maximum of Rs.5 crores. The AOY limit is fixed at 3 times the AOA limit (Max.Rs.15 Crores).

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