A Guide To Liability Insurance

Public Liability Insurance

Whilst this cover is not compulsory, it should be considered as a necessity by anyone running their own business. Unfortunately we are living in a litigious society where people are aware of their rights to claim. Years ago, if someone tripped over a hosepipe they would have got up, brushed themselves down and walked off thinking how stupid they were for not looking where they were going. It’s a different story these days and now, with the ease of access to personal injury solicitors, people will be seeking financial compensation for their injuries.

Basic protection for you and your business will indemnify you up £1,000,000 (or higher if required) against claims made against you by members of the public for damage or injury as a result of your negligence for which you are legally liable.

There are two types of policy available for valeters/detailers, a “per capita” Liability policy and a Motor Trade Liability policy. There are distinct differences between the covers under the policy and, in the same respect, substantial differences in premium.

“Per Capita” Public Liability Insurance

There are quite a few Insurers who offer “per capita” Public Liability policies. These policies are traditionally for Tradesmen who operate without premises (bricklayers, painters & decorators, carpenters etc) and the premium is based on the number of persons, hence “per capita”. Some Insurers have an extensive acceptable “trade” range under these policies and can include the business description “Car Valeters”.

These policies are competitively priced with an excess (the amount you have pay towards a claim) for “third party property damage” is generally £100 depending on the experience in the trade.

Per Capita policies do have their limitations. You have to bear in mind they are generic policies for a wide range of trades and the policy is then endorsed with specific trade exclusions (e.g. depth limits for groundworkers, exclusion of tree felling for landscape gardeners etc). With regard to valeters, the trade description is generally noted as “Car Valeters” and at best “Valeters of Cars & Vans Up to 1000kg GVW”, although there are not many vans less than 1000kg’s! Therefore under the “per capita” Liability policy, if someone trips over your hosepipe whilst you are cleaning a car then this covered, but if someone trips over a hose when you are cleaning, for example, a Ford Transit van, there is no cover under the policy as this falls outside the business description.

It is also important to note that these policies will exclude any damage to the car you are valeting/detailing. This is not just as a result of the act of cleaning but a full exclusion and therefore any damage to the vehicle, regardless of cause, even accidentally dropping something on it, is not covered.

The policy excludes any motor vehicle liability (if this cover is required, you will need to consider a Motor Trade Road Risks policy).

So to summarise, a per capita policy is a competitively priced Public Liability cover with a low policy excess but only applies in respect of the valeting of cars and excludes any damage caused to the car you are cleaning.

Subject to an additional premium, some per capita policies can be extended to include tools cover. This provides cover for your tools and stock. The limits vary, but normally the limit is a total of £1,500 per person with a single item limit of £750. The vehicle has to be locked for theft cover to apply and overnight theft is excluded from vehicles unless it is in a locked garage between the hours of 9pm and 6am. Usually an excess of £100 applies to claims.

Our EXCLUSIVE “Per Capita” Liability Scheme

Having read the above, hopefully you will understand that whilst “per capita” Public Liability policies offer great value for money, the trade definition is very restrictive, covering “car” valeters only and with low sums insured for tools, equipment and stock.

Working with members of the valeting industry, we have negotiated a facility with a leading UK Insurer that will cater more specifically for valeters & detailers and the type of work they do. The benefits of this exclusive scheme are as follows -

• Competitively priced “per capita” Liability Insurance
• Trade description “Mobile Car Valeters & Detailers”
• Business activities endorsed as “Mobile Valeting & Detailing of Cars, Vans up to 3.5t, Motorhomes & Caravans (provided income from vans, motorhomes & caravans does not exceed 10% of turnover)”
• Public Liability indemnity limits available are £1m, £2m & £5m
• Cover for Tools, Equipment & Stock at £1,500, £2,500 & £5,000 with a single article limit of £1,000 and subject to a £100 excess
• Option to include Employers Liability and Temporary Employees cover
• £100 Third Party Property Damage excess (increasing to £350 for persons with less than two year experience in the valeting trade)

As with all “per capita” policies on the market, damage to “items worked upon” is excluded. Again, if you require this cover, we can arrange a Motor Trade Liability policy (details of which are below).

With regard to the Goods In Transit, the limit of £5k on the tools/stock and equipment with a single article limit of £1,000 should hopefully be enough cover for most, but if higher limits are required, we can arrange a separate “Goods In Transit” policy. It is also important to note that overnight theft (between the hours of 9pm & 6am) is excluded unless the vehicle is securely garaged. It does however cover theft from a locked vehicle outside these hours (for example, if you stop off at a supermarket to buy lunch on a way to a job and come back to find your van forced open and all your kit stolen, or worse still the whole van stolen including your kit) and also covers the goods should they be damaged in an accident. If overnight theft cover is required, again we can arrange a separate Goods In Transit policy including overnight theft.

Motor Trade Public Liability Insurance

Public Liability for valeters & detailers is available under a Motor Trade Liability policy which caters more specifically for persons in the Motor Trade. These policies can cover a wide range of motor trade activities (not just valeting) and also a much wider range of vehicles. The standard policy usually covers cars and vans up to 3.5 tonne GVW and can be extended to cover various other things such as HGVs or agricultural plant. Various levels of cover are available and these are usually £1m, £2m or £5m.

Policy cover can be extended to include damage to Items being worked upon (known as Care Custody or Control). You may find that some of your customers insist that your Public Liability policy covers the vehicles you are valeting/detailing and this will ensure that you are adequately covered. There is limit of £50,000 in respect of this extension which can be increased to £100,000. Normally an excess of £1,000 applies to damage to items worked upon (which means you will be responsible for the first £1,000 of any damage you cause to the vehicle), but under our exclusive facility we have negotiated with the Insurers that a reduced excess of only £500 will apply.

The policy cover also includes Servicing Liability. This is something normally taken up by mechanics and the like and covers damage or injury as a result of servicing or upkeep of a vehicle. We consider this an essential cover for anyone selling or servicing cars and an example of this would be injury or damage due to not tightening wheel nuts properly following a brake pad change. Although there is certainly a lower exposure to claims of this nature as a result of valeting/detailing, it is still something that should be considered when making a decision on which policy to purchase. Examples of potential claims would be overspill of tyre shine on brake discs causing the brakes to fail, or perhaps overspill of polish onto foot pedals following an interior valet and so on.

It is not possible to extend this policy to include “Goods In Transit” cover and it will be necessary to arrange a separate policy if this cover is required.

Employers Liability Insurance

Finally, if you employ anyone, even part time or casual, whether you pay them or not, it is a statutory legal requirement that you have Employers Liability in force. This is explained further here - www.hse.gov.uk/pubns/hse40.pdf

Employers Liability indemnifies the policyholder against any injury or disease suffered by their employees during their course of employment. Again the employer has to be legally liable for the injury or disease, but it is often the case that courts rule in favour of injured party where employees are concerned. Obviously you have a duty under Health and Safety requirements to provide adequate training, protective gear etc to provide a safe working environment for your employees, but a chemical splash to the eye could result in a claim and it will most likely be successful due the employer failing to supply and insist on the wearing of the appropriate protective clothing/goggles, there could be back injuries due to lack of training on lifting procedures, injuries due to improper use of machinery as a result of insufficient training, the list goes on!

Both the "per capita" and the "Motor Trade Liability" policies can be extended to include Employers Liability at an indemnity limit of £10,000,000. If you have employees, the Public Liability Insurance also extends to include the actions of your employees.

Goods In Transit Insurance

If you require cover for more than the £5,000 or a single article limit higher than the £1,000 available under our "per capita" Liability Scheme, or wish to include overnight theft, or opt for the “Motor Trade Liability” policy, we can arrange a separate Goods In Transit policy. Premiums can vary depending on your location, limit of indemnity and if overnight theft is required.

Overnight theft cover can be included and will be subject to 20% co-insurance clause which will apply after the deduction of the policy excess of £100. For example, if you had £2100 of kit stolen overnight, the insurers would deduct the excess of £100 and then a further 20%, therefore the settlement would be £1600.

The main benefits of the policy are as follows:

• Damage to goods & tools whilst in the vehicle (e.g. road accident)
• Damage to goods & tools whilst being loaded or unloaded from the vehicle (e.g. goods or tools dropped whilst loading
• Loss of goods or tools following theft from a locked vehicle
• Hijack of the vehicle
• Theft of goods removed from the vehicle for safekeeping overnight in the Insured's lockfast private dwelling house or lockfast garage
• £100 policy excess
• Option to include overnight theft cover (subject to a 20% coinsurance clause)

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