What is liability insurance?

Seeing as you required to repair any damages you cause to third parties, liability insurance may be necessary

According to the Spanish Civil Code, the person who causes damage to another has the obligation to repair that damage. This general obligation translates into different consequences that vary in economic terms according to the type of damage.

Damages can be caused to a third party by both individuals and large corporations, however, the risk of these types of contingencies and the compensation amount varies from one case to another. For this reason, there is type of public liability insurance to help you handle such an incident, according to the circumstances. Public liability insurance is compulsory in several areas and contexts.

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In this article we will tell you what public liability is, give you some indications of different ways to insure against it and tell you about our star product, the BBVA SMEs and Self-Employed PL Insurance, which you can arrange at the simple click of a button.

Public liability in the Civil Code

The Civil Code is the legal body that substantially regulates civil legal matters. In Spain, this general regulation was enacted in the Spanish Official Gazette (BOE), No. 206, of July 25, 1889, which, after many modifications, remains in force to this day.

Article 1902 of the Civil Code states: “Any person who by act or omission causes damage to another person, involving fault or negligence, is obliged to compensate for the damage caused”.

Therefore, this requires all persons to respond for themselves or for those under their care, as indicated in article 1903 of the same text (parents for their children, guardians for those under their care, owners or managers for their employees or shop assistants, etc.).

This obligation on the party liable for the damage, called public liability (often abbreviated to PL), usually means in the first instance a financial indemnity, or in the event of a dispute, a subsequent court hearing. Therefore, in any case, this responsibility can entail a significant payment of money, putting the personal wealth or viability of a company at risk.

Faced with the significant problems that result from damages caused to third parties, certain contingencies can be covered an insurance policy which will take effect when an incident occurs. Aspects ranging from a childish prank to negligence by a major multinational will result in the payment of compensation, which varies according to the damage caused. Therefore, it is important to examine the different types of Public Liability.

Types of public liability

Since public liability varies from one case to another, it can be approached in different ways. Therefore, when deciding on a civil liability insurance policy, we must consider the following fundamental question: Who does it cover? me, my company or the people under my supervision?

  • For a family, a public liability policy would be most suitable. This type of policy covers damages caused by the policyholder, as well as the people or animals under the policyholder's supervision. BBVA Home Insurance includes a PL guarantee as part of its coverage, as established in the contractual conditions, for all members of the household, including if the family has a pet that is a breed not declared to be dangerous.
  • Public liability insurance for companies or the self-employed protects against damage caused to third parties in the course of business or commercial activities. To cover this type of contingencies, we offer SME and Self-Employed PL Insurance, which, depending on the contractual conditions, offers the service and quality of one of the leading specialist insurers of PL policies: HISCOX.
  • Public Liability Insurance for Officers and Directors offers coverage to protect their personal assets and from the financial repercussions of legal defense. The Public Liability for Managers is also covered by Hiscox's Public Liability Policy for Managers and Directors, which, in accordance with the provisions of the contract conditions, in addition to the Public Liability for Managers, offers different types of coverage, such as Corporate Public Liability and Professional Internship Public Liability, making it one of the best options on the market.
  • A public liability policy for hunting and fishing aims to indemnify damages to third parties resulting from those activities, which in some cases can even result in death. In this case, we offer the Public Liability Policy for Hunting of the insurance company CASER, in which, in accordance with the provisions of the contract conditions, customers can choose between a "Basic" option, which offers the coverage required by law, or "Extended" coverage, which covers contingencies such as: Bodily injuries (<65 years), damage to hunting weapons, death of hunting dogs, healthcare and legal defense / bonds.
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With professional public liability insurance, you can face the unexpected that comes with your professional activities, be they management, advisory or consulting services or more. Any person or business that provides professional services might find themselves receiving such a claim. The BBVA SMEs and Self-Employed PL product can offer a frontline solution to all Insurable Activities.

Each SME and self-employed worker requires a different type of insurance that adapts to their needs, as the forms of coverage and amounts claimed are not the same. Civil Liability Insurance should guarantee payment of legal expenses and the possible claim (if it is covered).

However, each case is different and should be analyzed individually. Therefore, one of the following insurance policies will almost certainly be useful: BBVA RC Pymes y Autónomos Insurance

Example of BBVA RC Pymes y Autónomos Insurance

BBVA RC Pymes y Autónomos Insurance is a Public Liability Insurance policy that protects against damages caused to third parties resulting from your professional activity. It is designed for Self-Employed Workers and Small and Medium-Sized Enterprises. It is an insurance policy to save you from worrying about potential pay-outs or defense costs resulting from any insured loss. Did you know that the coverage of this insurance includes compensation to third parties caused by economic, material and/or personal damages, and protects you and up to 10 employees of your company?

Taking out this insurance policy, in accordance with the insurance contract, puts your mind at ease by covering the insurable Public Liabilities for your professional activity in a single policy. It also comes with an attractive option to tailor your policy by choosing different limits on the insured capital or different excess amounts. In other words, by accessing different types of situations derived from the public liability clause, you can set up an insurance policy that suits your professional activity and needs perfectly. In short, by benefitting from the most comprehensive coverage, you can carry out your activity with total peace of mind. 
With regard to the payment method, you can make a single payment or pay in installments. And you can take out the insurance regardless of whether you are a BBVA customer or not. 
You can find complete information on the product in the section of the website dedicated to insurance, where you will also find other options for insuring your civil liability. Make sure to visit the website or contact an agent via bbva.es to answer your questions, and, most importantly, to find an insurance policy that suits your needs and provides genuine help against unexpected claims.


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