The policy documentation you get when you buy insurance is important. It tells you what you’re covered for and it also tells you what you’re not covered for.
The trouble is that insurance policies are lengthy documents and the vast majority of the information contained within them is the same no matter which insurance company you use. There will be some insurers who offer cover extensions that other insurers don’t offer, and some insurers will offer slightly more restrictive cover.
Given this, you don’t want to send several dozen pages of insurance policy documentation to anyone who wants to know whether you’re insured, so insurance certificates are a good way to prove that you have insurance cover and provide a summary of your cover.
Are public liability insurance certificates a legal requirement?
Because employer’s liability insurance and motor insurance are required by law, insurance certificates proving that you have these covers are also a legal requirement.
However, public liability insurance is not a legal requirement. As such, you are not legally required to have a public liability insurance certificate.
So, why do you need a public liability insurance certificate?
Although public liability insurance isn’t a legal requirement, many people can require you to have this type of insurance.
If you’re working as a sub-contractor, for instance, the main contractor will often insist that you have public liability insurance as a condition of the contract. If you cannot provide evidence that you have this type of insurance, you may struggle to find work and it is possible that you will not be allowed on site.
In addition, some professional bodies and trade associations will insist that you can provide evidence that you have public liability insurance as a condition of your membership. Some local authorities will also require proof that you have this type of insurance before they will allow you to work.
A public liability insurance certificate is a convenient way to demonstrate to these different entities that you have a valid insurance policy in force.
What information does a public liability insurance certificate contain?
Employer’s liability certificates contain very basic information. The information is limited to who is insured, the insurance company and policy number, and the period of insurance.
Motor insurance certificates are also fairly basic, although they contain slightly more information because they also contain details of the vehicle that is insured and who can drive it.
Public liability insurance certificates are much more extensive because as this type of insurance isn’t a legal requirement, there can be quite large differences when it comes to the cover provided by different insurers. They still list who is insured, the insurance company and the policy number, and the period of insurance, but they also give details of the cover provided by the policy.
One of the most important details they list is the indemnity limit in the policy. The indemnity limit is the most that the insurer will pay in the event of a claim. This is important because if a contract stipulates that you are required to have public liability insurance it will also usually stipulate a minimum acceptable indemnity limit.
The also state the business description used in the insurance policy. This is important because you are only insured for the activities that are included in your business description. Main contractors need to know not just that you have a public liability insurance policy, but also that you are insured for the work that you are doing for them.
Any major cover exclusions will also be listed. This could include an exclusion of cover for heat use, a height or depth limit that restricts what work you can do or a territorial limit that means you are not insured for any work that you do outside of the UK.