Third party liability insurance

What is third party liability insurance? This is simply a form of liability insurance that covers you in the event of damage or injury to a third party – i.e., someone other than you.

Insurance is designed to be a safety net – something that is going to offer coverage and defence in the event that the worst happens. If you have an accident in your car and you unfortunately injure your leg and damage the front bumper and bonnet of your vehicle, you may decide to claim on your insurance for private medical care and damage repair. But what if someone else gets injured, or if you damage someone else's vehicle or their property in the accident?

This "someone else" is the third party. If the accident is found to be your fault and results in expenses for the other person, your third party liability insurance may provide the cover you need.

Third Party Liability Car Insurance

You've probably heard about third party car insurance, and for good reason – third party only (TPO) is the absolute minimum level of insurance you need to have if you want to drive a car on the road in the UK. It's a legal requirement for all drivers!

This is a form of third party liability insurance. You will not receive any cover for your own injuries, damages, or costs through this insurance, but you should be protected for those incurred by others. The reason this is mandatory in the UK is to prevent injuries and damages caused by uninsured drivers, essentially making Britain's roads safer for everyone.

You can build upon this minimum foundation if you would like to achieve extra cover. For instance, third party fire and theft will provide the third party liability cover you need to operate on British roads, as well as the cover against fire damage and theft that is not included in TPO. Comprehensive insurance, on the other hand, should offer some cover in a wider variety of instances in exchange for a higher premium.

Third Party Liability Home Insurance

You may also see third party liability insurance mentioned in relation to your home cover. This works in the same way as other forms of third party liability, and will offer protection if someone suffers an injury or damages while visiting your home or property. This may also be known as Occupiers Liability.

Generally, we think of our homes as private spaces. If you injure yourself in your own home, you probably won't blame anyone else for this, and so you might think that no one can hold you responsible if they are accidentally injured on your property. However, this may not be the case. If someone trips on a damaged step at your home and breaks their arm, you may be held liable. This may also extend to property damage – if someone slips on your kitchen floor and smashes their brand new iPad, you might be expected to pay for this.

Third party liability insurance may offer some cover in this case. As an example, if an acquaintance visits your home, trips on a loose floor tile, damages their knee and cannot work for a while, third party liability insurance may cover this and protect you from having to handle the costs yourself. Alternatively, if a tradesperson makes a call at your property, and your fence falls over and dents their van, this may also be covered under third party liability insurance.

You will not be legally required to take out third party liability home insurance in the UK.

Third Party Liability Contents Insurance

Some insurance providers may be able to offer you personal liability cover for other instances of damage or injury. This may be included under your home's contents insurance – of course, it is always important to check with your insurance provider to make sure this is the case.

Basically, if you have an item like a rake or another gardening implement and you accidentally injure someone or damage something with this, third party liability contents insurance may cover this.

Third Party Liability Commercial Insurance

If you run a business in the UK, you may need third party liability insurance for your commercial premises. This is not true in all cases, but it is worth checking with your industry authority or local government body to make certain – if you do not have the proper level of insurance coverage for your business, you might end up with a fine.

Even if third party liability insurance is not mandatory for your type of business, it still may be worth considering. This is especially true if you operate any kind of public-facing business, or any premises that are regularly visited by members of the public. A trip, slip, fall or another incident on your property could result in an expensive claim, so it may be useful to get protected – it should be noted that Urban Jungle does not offer this kind of insurance for commercial premises.

Limits to Third Party Liability Insurance

It is important to bear in mind that third party insurance is not supposed to be a substitute for safe and responsible action. Even if you are covered, you can still end up with a criminal charge if you are found to be at fault. Basically, you still need to make sure that you are acting in the right way and are conscious of the safety of others. For example:

• You can still have a dangerous or negligent driving charge brought against you, even if you have third party insurance.
• You are still required to do your best to ensure the safety of any visitors to your home.
• You still need to use your tools, equipment and other belongings in a safe manner – remember the garden rake example above!
• You still have a duty to protect the health and safety of everyone on your business premises.
• Your insurance won't prevent any criminal charges!

Your payout could be refused if you do not act safely and responsibly, whether on the road, in your home, at your place of business or anywhere else.

Urban Jungle is not a financial advisor and information in this article should not be taken as advice or recommendation.