What is Public Liability Limit?

The public liability limit is the maximum amount an insurer will pay for any single claim or in aggregate under a public liability policy. Standard limits for small businesses are £1 million, £2 million or £5 million. Some clients, local authorities and contracts specify a minimum limit — often £5 million or £10 million — and businesses that cannot demonstrate adequate cover may be excluded from tendering. If a claim exceeds the policy limit, the policyholder becomes personally liable for the excess, which can be catastrophic for a sole trader or small company. Higher limits cost relatively little extra and are generally advisable for businesses working on larger sites or with members of the public regularly.