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bi-monthly
HPASA newsletter. |
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August 2012
WHAT
IS PUBLIC LIABILITY INSURANCE?
By Gavin Courtenay,
Managing Director, SATIB Insurance
Brokers |
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| Gavin
Courtenay, Managing Director
at SATIB Insurance Brokers |
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Liability
insurance provides cover
for your business against the financial
risk of being sued by a member of
the public, says Gavin Courtenay,
Managing Director of SATIB
Insurance Brokers.
When guests or visitors are on your
premises and they are injured or become
ill as a result of you or your staff’s
negligence, which results in them
suffering financial loss, and subsequently
lodging a claim for compensation from
you, then public liability
insurance will pay for your
legal defence costs, and if the court
finds in the complainant’s favour,
the costs of the claim up to the indemnity
limit.
Certain funding bodies, tourism trade
associations such as the Southern
African Tourism Services Association
(SATSA) and certain government
regulations require tourism businesses
to have public liability insurance
in place.
If a tourist were to institute a claim
against a tourism service provider
that does not have liability insurance,
then both the owners of the business
and their employees’ financial
future may be in trouble. Added to
this is the fact that a claim that
is not honoured may have a negative
effect on both the tourism industry
and the country as a whole. |
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General Public (and Products) Liability
business insurance covers a range of
accidents or incidents that might occur while
guests or visitors are on your premises, where
you have been judged to be negligent. You may
be deemed to be negligent if you do (or fail to
do) something without a reasonable amount of care,
or fail to prevent an accident because you did
not take enough care to avoid the accident occurring.
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Liability
claims will be influenced by:
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Whether negligence
can be proven - was your company at
fault? |
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Whether an indemnity
form was signed - was the client made
aware of any risk and did they sign
the indemnity form? |
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Whether everything
is accurately recorded and statements
that are made are comprehensive -
how did your company handle the situation
after the event? |
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Whether a company complies
with all the local laws of the industry
– are you licensed appropriately
and do your staff members have the
necessary training? |
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Whether a company admits
guilt. |
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IN A NUTSHELL:
Public Liability Insurance
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Transfers the risk of being
sued for negligence. |
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Covers you for damage to
third party property. |
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The amount of cover (indemnity)
needed depends on affordability - rather
over insure than under insure i.e. more
is better than less. |
CASE STUDY:
A guest walks into a hotel lobby and slips
on a wet floor. He is injured and no signage
is present to warn that the floor is wet
and slippery. He claims financial compensation
for his hospital bills from the hotel. General
Public Liability insurance would pay for
this situation. |
GLOSSARY:
Accident - an unexpected and
undesirable event, especially one resulting in
damage or harm
Compensation - money, in payment
for loss
Guilt - responsibility for wrongdoing
Incident - an event that has
potentially serious results
Indemnity - a sum of money paid
in compensation
Insurance - financial protection
against loss or harm
Liability - obligation under
law
Negligence - civil wrong causing
injury or harm
Premium - cost of insurance
Third party - somebody involved
by chance
TIP: Contact the services of
a tourism–specific emergency response call
centre as your liability for decisions made in
a crisis will then be transferred and the incident
recorded for future reference.
TIP: As liability insurance is
negligence based (i.e. negligence must be proven
in a court of law), it is important to ensure
that the policy does not cap (limit) legal costs.
NB: The above article may be reproduced provided
that acknowledgement is made regarding the source
and author. Article extracted from the SATSA /
RETOSA Tourism Tattler Trade Journal – Issue
5 of 2011
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| For
more information
on business liability
insurance and other
insurance options,
contact Gavin Courtenay
of SATIB Insurance
Brokers on 0861
728 4248 or gcourtenay@satib.co.za |
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