Liability insurance is a crucial aspect of protecting yourself or your business from potential lawsuits or claims. It covers the costs associated with legal action taken against you for damages or injuries caused to someone else. In Kenya, liability insurance policies are available for various industries, including healthcare, construction, and hospitality, among others. This guide will provide an overview of the different types of liability insurance policies available in Kenya, their benefits, and frequently asked questions to help potential buyers make an informed decision.
Public Liability Insurance
Public liability insurance is designed to protect businesses from legal action taken by members of the public who have suffered injuries or damages as a result of the business’s operations. For example, if a customer slips and falls in a store, public liability insurance can cover the cost of any legal action taken against the business. This policy also covers any compensation awarded to the injured party and any associated legal costs.
Professional Indemnity Insurance
Professional indemnity insurance is specifically designed for professionals such as doctors, lawyers, architects, and engineers. This policy covers legal costs and compensation awarded to a third party if a professional is found to have provided negligent advice or services, resulting in financial loss or damage to the client.
Employers Liability Insurance
Employers liability insurance is mandatory for all employers in Kenya. It covers the costs associated with any legal action taken by an employee who has suffered an injury or illness as a result of their work. This policy covers compensation awarded to the employee and any associated legal costs.
Product Liability Insurance
Product liability insurance covers the costs associated with any legal action taken against a business for injuries or damages caused by a product they have manufactured or sold. This policy covers compensation awarded to the injured party and any associated legal costs.
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Directors and Officers Liability Insurance
Directors and officers liability insurance is designed to protect directors and officers of a company from legal action taken against them for any wrongful acts committed in their role. This policy covers legal costs and compensation awarded to a third party if a director or officer is found to have acted negligently or breached their fiduciary duties.
FAQs:
Do I need liability insurance if I am self-employed?
Yes, as a self-employed individual, you are still liable for any damages or injuries caused to others while carrying out your work. Liability insurance can protect you from legal action taken against you for any financial loss or damage caused.
How much liability insurance coverage do I need?
The amount of coverage required depends on your business and the level of risk involved. A professional who provides advice or services may need a higher level of coverage than a retailer, for example. It is important to consult with an insurance professional to determine the appropriate level of coverage for your needs.
What is excluded from liability insurance policies?
Liability insurance policies typically do not cover intentional acts, criminal acts, and losses resulting from contractual obligations.
What is the claims process for liability insurance?
In the event of a claim, the insured must notify the insurer as soon as possible and provide all necessary documentation, including police reports, medical reports, and witness statements. The insurer will then investigate the claim and determine whether it is covered by the policy.
How much does liability insurance cost?
The cost of liability insurance varies depending on the type of policy, the level of coverage, and the level of risk involved. It is important to obtain quotes from several insurers to ensure that you are getting the best coverage at the most competitive price.
Conclusion:
Liability insurance is an essential aspect of protecting yourself or your business from potential legal action and financial loss. The different types of liability insurance policies available in Kenya are tailored to meet the specific needs of different industries and professions. Public liability insurance protects businesses from legal action taken by members of the public, while professional indemnity insurance is designed for professionals who provide advice or services.
Employers liability insurance is mandatory for all employers in Kenya, while product liability insurance covers businesses against legal action taken for damages or injuries caused by a product they have manufactured or sold. Directors and Officers liability insurance is designed to protect directors and officers of a company from legal action taken against them for any wrongful acts committed in their role.