5 Business Liability Exposures to Know

Every organisation faces the possibility of business liability risks, which involve situations where the organisation might be held legally or financially accountable for injury, harm, or damage to another party.

Here are five of the most common types of business liability risks:

1. Occupiers' liability: This risk refers to the potential liability an organisation faces if a customer or client gets injured on its premises.

2. Employers' liability: This describes the risk of an organisation being held accountable if an employee gets injured or falls ill while performing their work duties.

3. Products liability: Organisations involved in manufacturing, distributing, or selling products face this risk, which arises from  dealing with unsafe or defective products.

4. Professional indemnity liability: This involves the potential risk an organisation or individual faces due to errors or omissions made during their business operations, leading to financial losses for their clients. 

5. Directors' and officers' liability: This exposure arises when a director or officer of an organisation is found to have acted outside their terms of reference. Shareholders may blame directors personally for financial losses.

In the event of a business liability loss, an organisation may experience various consequences, including:

- Damages: If a court determines that the organisation is responsible for third-party damages, it may be required to compensate the harmed or injured party.

- Defence costs: Regardless of liability, an organisation may need to cover legal defence costs and other expenses associated with the claim.

- Reputational harm: Losses can lead to reputational damage for an organisation, resulting in lost business, decreased employee retention, and diminished consumer loyalty and investor trust.

If you need further assistance in reducing your business liability risks, feel free to contact us today.