Third-Party Liability: When a Customer Is Harmed at Your Business

On a rainy day, a customer walks into your shop and slips on the wet floor. In a café, a decorative object falls from a shelf and breaks a guest’s phone. In an office, a visitor is hurt when an unsecured cabinet tips over. In each case, the injured person is not an employee but an outsider. This article looks at third-party liability cover for businesses, often called public liability, and how it works in practice.

Who is a third party?

In insurance terms, a third party is anyone other than the insured business and its employees: customers, visitors, supplier representatives, couriers and passers-by. Injuries to your own employees at work are a different matter, usually handled by employer’s liability cover. For more on that distinction, see our guide on why employer’s liability insurance matters.

What the cover pays for

Third-party liability cover pays, within the policy limits, for damage caused to third parties during your business activities and legally claimed from you. It usually falls into two groups:

• Bodily injury: treatment costs from an injury and, depending on the policy, other items.
• Property damage: damage to a customer’s belongings, vehicle or other property.

Depending on the policy, the cost of defending an unjustified claim may also be included. Scope and per-person or per-event limits vary by insurer and package.

Typical risks by sector

Shops

Wet or slippery floors, unstable shelving, falling goods, and accidents on doors and steps are the most common risks.

Cafés and restaurants

Spilled hot drinks, broken crockery, damage to customers’ belongings and accidents at busy times stand out. Food-related illness is often handled under a separate cover or product liability; ask your agent about it.

Offices and plazas

Falls in reception areas and accidents involving furniture or office equipment can occur. In plazas, responsibility for accidents in common areas is often assessed between the building management and the tenant.

Service workshops

Accidents when customers enter the workshop, and work that could harm people nearby, belong here.

Reducing risk and what to do after an incident

1. Keep floors dry and use wet-floor signs.
2. Fix shelves and heavy furniture to the wall.
3. Use non-slip surfaces and good lighting on stairs.
4. Clearly mark areas customers should not enter.
5. Record the date, time, witnesses and photos of any incident.
6. If you have CCTV, keep the footage.

First help the injured person and call emergency services if needed. Photograph the scene and take witnesses’ contact details. Be kind and helpful, but avoid written statements admitting fault or promising a payment before you speak to your insurer. Then report the incident to your agent as soon as possible; reporting periods and required documents are set in the policy terms. Make sure staff know who calls for help, who takes photos and who informs the manager.

Good habits among staff matter as much as the policy. Train new employees to place wet-floor signs during cleaning, to keep heavy goods on lower shelves and to stay calm and helpful if a customer is hurt. A short written procedure kept behind the counter means that, on a busy day, nobody has to guess what to do next, and the records needed for a claim are complete.

Setting the limit and contract requirements

When choosing a limit, think about how many people visit, the nature of your activity and the worst realistic scenario. An office with few visitors and a busy restaurant have different needs. Leases in office complexes and shopping centres may require tenants to hold liability insurance with a stated type and limit, and corporate clients may ask service providers for proof of cover for work at their premises. Check whether your policy covers only your own premises or also work at client addresses. Describe your activity fully: if you insured as a shop and later start installation or repair services, tell your agent. Foreign-owned companies should make sure the policy is issued in the correct company name and tax number.

To assess liability cover for your business, visit our Maslak business insurance page. Call Ailenizin Sigortacısı on +90 530 375 89 61 or send a WhatsApp message for English-speaking support.