30.05.2019
News
Understanding financial loss

Traditional PUBLIC AND PRODUCTS liability policies are increasingly including cover for financial loss as an extension, but what does it mean, do you need it and, if so are you adequately covered?

If a business suffers financial loss as a resulting FROM the actions of you OR YOUR business, they could file a claim against you, even if they don’t SUFFER PHYSICAL incur injury or damage. Such a claim could easily run into tens of thousands of pounds, which is why you may need cover for financial loss.

For example, a flooring contractor lays a floor that isn’t fit for purpose and the floor has to be re-laid, causing the delivery of a new machine to be delayed. The client faces additional costs for storage and transportation of the machine and claims against the contractor for financial loss. This would be covered by the contractor’s financial loss insurance policy.

Does your liability policy include financial loss? Some traditional liability policies include cover for financial loss, while others don’t or have restrictions in place that limit cover. Here’s a brief guide as to how the mainstream liability policies differ.

Public liability covers your liability to ANY OTHER PARTY ,OTHER THAN YOUR EMPLOYEES, WHERE LOSS OR DAMAGE IS CAUSED BY YOUR NEGLIGENCE. STANDARD WORDINGS DO NOT INCLUDE FINANCIAL LOSS

Products liability covers your liability to ANY OTHER PARTY ,OTHER THAN YOUR EMPLOYEES, WHERE LOSS OR DAMAGE IS CAUSED BY SOME DEFECT IN YOUR PRODUCT ARISING FROM YOUR NEGLIGENCE. STANDARD WORDINGS DO NOT INCLUDE FINANCIAL

Take professional advice This is a very brief overview to what is widely accepted as a complex area, calling for professional guidance. As your broker, it’s our job to assess your exposure to financial loss and ensure you have the necessary cover in place. To discuss further, please call us on 01865 292929 or email info@mathewscomfort.com

Sources:

FINANCIAL LOSS. What is it, and when is it covered? A report from a Working Party of the IUA’s Liability Underwriters’ Group in association with RPC. Available as pdf download at:

www.iua.co.uk
www.tradesmansaver.co.uk

02.10.2019
News