How Liability Insurance works

The cost of insurance - known as the premium- is typically calculated using loss statistics, plus the insurer's costs and reflects their appetite for your particular type of business- if they want your type of business the premium will be less than if they don't.

The premium is also calculated on Thames Insurance Group's estimate of the level of risk attached to a particular business or industry area.

The premium will be affected by factors such as your claims history, the size of the perceived risk and your approach to risk management.

The safer your working environment and the fewer claims you have made, the cheaper your premium should be.

Premiums are also calculated on the records of other similar businesses by lumping good and bad together - small businesses with a good record may be adversely affected by this. Your own safety record and approach to risk management can minimize the effect of this.

Employers', Public and Product liability

For employers' liability, the exposure risk is assessed on the basis of the number of employees and the size of the payroll. In addition, your awareness of good risk management, will also influence how risk is assessed.

For public and product liability the exposure risk is based on the turnover and factors such as whether you work away from your premises.