Business insurance
What is public liability insurance, and what is no-fault liability?
Under the Public Liability Insurance Act, 1991, owners who handle hazardous substances must take insurance to pay immediate relief to people harmed by an accident involving those substances. The liability is no-fault: relief is payable without the victim having to prove negligence. Separately, many businesses buy general public liability cover for harm to visitors and the public.
In short
- The Public Liability Insurance Act, 1991 applies to hazardous substances.
- Relief is no-fault: the victim need not prove negligence.
- Owners handling hazardous substances must insure against this liability.
- General public liability cover is a separate, wider choice.
What is no-fault liability?
A rule that makes someone liable to pay relief without the claimant having to prove they were at fault. Under the Public Liability Insurance Act, if an accident involving a hazardous substance causes death, injury or property damage, the owner must pay the relief the Act sets, whether or not they were negligent.
Who must buy public liability insurance under the Act?
Owners who handle hazardous substances. If your business stores, uses or transports substances classed as hazardous, the Act requires insurance against this liability before you start handling them.
Is that the same as general public liability insurance?
No. The Act’s cover is narrow: hazardous substances and the relief it sets. General public liability, often part of commercial general liability, covers harm to visitors and the public from your premises and operations more broadly. Many businesses need both.
Frequently asked questions
What is no-fault liability?
Liability to pay relief without the victim having to prove negligence, as under the Public Liability Insurance Act, 1991.
Is public liability insurance mandatory in India?
Yes for owners handling hazardous substances, under the Public Liability Insurance Act, 1991. General public liability cover is otherwise optional.
What is the difference between public liability and CGL?
The Act's cover is limited to hazardous substances; CGL covers harm to the public from your premises and operations more widely.
What happens when you talk to us
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A note on this page. Everything here is general information, not legal advice, and nothing is an offer. Statutory positions are as understood at the review date and must be checked against current law before relying on them. For advice about your situation, talk to us.