What’s the difference between Public Liability and Professional Indemnity?
Public liability is used to protect businesses from third-party lawsuits due to injury or property damage caused by your business operations. Professional Indemnity is used to protect businesses from client lawsuits due to services they’ve provided.
Public Liability vs Professional indemnity Coverage
Coverage
Public Liability Insurance
Professional Indemnity Insurance
Physical injury or property damage to third-parties (e.g. customers, members of the public)
Yes
No
Professional errors & omissions
No
Yes
Defamation
No
Yes
Here are real-world public liability vs professional indemnity claims examples, which will illustrate the differences in more detail:
Example Company
Public liability
Professional indemnity
Construction firm
You’re constructing a building, and accidentally damage surrounding properties.
You’re liable to the property owners for the damage you caused them due to your business operations.
You’re constructing a building, and your workers do a shoddy job causing structural instability.
You’re liable to your client for financial losses you caused them due to your negligence/errors/omissions.
Doctor’s clinic
A patient slips and falls in your clinic, injuring themselves.
You’re liable to the patient for their injury, since it was caused by your business operations.
Your medical advice worsens the patient’s condition.
You’re liable to the patient for causing them bodily harm due to your negligence/errors/omissions.
Financial services firm
You post some advertising signboards in public. One of your signboard falls on a pedestrian,injuringthem.
You’re liable to the pedestrian for their injury, since it was caused by your business operations.
You trash a competitor with exaggerated claims about how bad their business is.
You’re liable to the competitor for defamation.
In each of the above scenarios, this is how each type of insurance would respond to protect your business against legal liability:
PublicLiability Insurance: This policy would protect you from the legal fees and damages awarded to your injured client. Some public liability policies will also have Food & Beverage extensions, which will cover food poisoning caused by your business.
Professional Indemnity Insurance: This policy would protect you from the legal fees and damages awarded to your client.
Common misconceptions about public liability vs professional indemnity:
#1. Public liability covers liability to the entire “public” body right? So shouldn’t it cover me if I make mistakes while providing a service to clients?
Nope. Public liability is designed to protect you when your business accidentally causes injury or damage when conducting business activities in public, or that involve congregations of people. It’s not designed to protect you if you make a negligent mistake while providing your services. In fact, public liability policies will often come with clauses that will expressly exclude coverage for any protection offered by a professional indemnity policy.
#2. Public liability should cover me if my business makes defamatory statements, right?.
That’s another nope. Public liability will not protect you if you make defamatory statements about someone else, like a competitor. Defamation encompasses slander (which is spoken), and libel (which is written). Only professional indemnity would cover you if you had committed such an act.
Do businesses need both public liability and professional indemnity insurance?
If your business involves providing any kind of services to clients, then yes – you need both insurance types. As you’ve seen in the above examples, public liability and professional indemnity protect you from very different – and very real – risks. If you only have one or the other, then you’re really exposing yourself to 50% more risk. If you have one of these policies, make sure to get the other so that you’ll be fully protected against lawsuits.
If your business sells only goods instead of services, then instead of professional indemnity, you’ll need a product liability policy. Product liability insurance will protect you from lawsuits targeting your business because of injuries or damage caused by goods you sold. Depending on what kind of goods you sell, the potential liabilities on your business may be huge. For instance, if you sell car parts to auto workshops that later turn out to be defective, you could cause fatal car accidents. You’d be legally liable for someone’s death in that scenario.
How much does it cost to have both public liability and professional indemnity insurance?
Public liability insurance is very affordable, with a large amount of $1,000,000 coverage starting at only $16/month (depending on the industry). That’s the price of a single meal in a restaurant!
Professional indemnity insurance will have higher premiums, and due to its highly tailored nature, quotes can only be produced with more precise information about the business seeking coverage. Get in touch with us for a quote on professional indemnity coverage for your company.
Remember that with Provide, you save up to 25% on your insurance premiums. Thanks to our digital operating model, our overheads are much lower, and we pass every dollar saved back to our clients.
Sometimes business owners might brush off the need for commercial insurance, viewing it as an unnecessary expense for a risk that will never materialise. We would urge extreme caution in this regard – legal liability is one of the most serious risks any business can face, particularly for small businesses that have limited resources to handle sudden, large expenses.
What are the typical coverage amounts businesses should have
What other types of liability insurance do businesses need?
In addition to public liability and professional indemnity, businesses should also have:
Directors & Officers (D&O) Liability Insurance: This type of insurance protects company directors & officers from personal legal liability. Most company directors are blissfully unaware that their position exposes them to a stunningly wide variety of legal liabilities. Get an instant D&O insurance quote here.
WICA Insurance (Work Injury Compensation): This type of insurance protects the business from liability when workers get injured on the job. Under the 2012 WICA Act, your workers can file a WICA claim against you if they get hurt or sick due to work-related causes. You’ll have to pay their medical fees and damages if the WICA claim is approved by the courts. MOM (Ministry of Manpower) regulations also stipulate mandatory WICA insurance for employees earning less than $1,600/month, or employees performing manual labour. Get an instant WICA insurance quote here.
Where can I get great public liability and professional indemnity insurance quotes?
Get broad-coverage and affordable quotes for public liability here, and professional indemnity here. With Provide, you save up to 25% on your insurance premiums. Our digital operating model creates lower overheads, and we pass every dollar saved back to you.
Xero Review 2020: Online Accounting for Small Business
Pros
Cons
Rich accounting features
User interface could be more intuitive
UI fairly intuitive
Customer support takes longer than needed to respond, needs improvement
Can generate 80+ different accounting reports
Mobile app functionality is poor
Inventory tracking
Fixed asset management
Customisable invoices
Extensive third-party integrations to extend functionality even more
Xero is overall a great software package for online business accounting. Xero serves more than 1 million businesses globally, and its easy-to-use interface and advanced features make it loved by many small-medium enterprises (SMEs). Xero boasts great functionality: extensive reports, customisable invoices, inventory tracking, and 800+ integrations. It also has unique features like allowing you to manage fixed assets, which other competitors don’t.
Xero is really ideal for small-medium businesses that need strong accounting features, put together in a well-designed package that really helps save time on accounting.
Xero Add-Ons
Payments
You can accept online payments with Xero Payments, which are powered by Stripe. Transaction fees are 3.4% + SGD 0.50 for online payments.
Payroll
Xero comes with a helpful Payroll add-on. You can schedule automatic wage payments (weekly, bi-monthly, monthly, etc.). You can pay employees specific amounts for the type and amount of work they do (e.g. software engineers who did both coding and graphic design for a project). You can also easily reimburse employees for work expenses.
New Additions
In the latest global update in September 2019, Xero added several new features on top of its already impressive function-rich base.
HubDoc Permissions
Xero acquired HubDoc in 2018, which allows users automate manual tasks like data entry and document collection. HubDoc scans documents like your receipts and bills, automatically extracts information, and uploads it as transaction data.
Previously, if you granted employees permission to HubDoc, they were able to see all uploaded documents without the possibility of individual restrictions. Xero’s latest update allows you to set specific permissions for each user: upload only, standard, or accountant/bookkeeper.
Stripe Live Feed and Auto Pay
You’re now able to view your Stripe transactions in real-time via Xero. This allows for easy reconciliation and simple importing of transactions. You can do this even if you don’t use Stripe as a payment service within Xero’s platform.
You can also receive automatic repeat payments from customers directly with Xero. You can set up repeat invoices for customers, and your clients can save their credit card details to make automatic payments to you.
Zendesk API
If you use Zendesk to manage your support functions, you now have a really useful integration. Your support team can now input the time they’ve spent on their support tickets directly into Xero’s time tracker. Logged hours can be instantly invoiced and reported, so there won’t be double entries caused by your support team manually entering hours in their own schedules.
Xero’ Features
Dashboard
Xero’ dashboard is clean and well-designed. It gives you a quick overview of your total cash balance, invoices, owed bills, and bank balances (if you’ve connected your bank accounts). You can move these accounts around, which is nice if you want to prioritise certain information. Xero’s dashboard gets the job done by giving you the most important information about your business every time you log on.
All the most important information about your business in one place
Chart of Accounts
Xero will create a chart of accounts template for you based on your industry. You can also import another chart of accounts into Xero. The layout is clean and it’s easy to filter through the list to find specific transactions.
General Ledger
Xero’s general ledger is well laid out. Transactions are sorted by account (e.g. advertising, utilities, etc.), so it’s easy to see the overall status of major parts of your business. The general ledger shows you debits, credits, net movement, and the YTD balance. All this is helpful in quickly understanding how each account is performing, and if major inflows/outflows are occurring you can easily spot them.
Business Performance
Xero’s Business Performance dashboard gives you a comprehensive look at a wide variety of performance metrics. You can see total revenue, expenses, your top 5 customers, cash balance, payables, overdue bills, and much more. You can view many common financial metrics that gauge liquidity, efficiency, leverage, and profitability. These include Account Receivable (AR) days, Account Payable (AP) days, Inventory Turnover, Current Ratio, Debt to Equity Ratio, etc. All these metrics are presented in graph form over time, so you can easily track how your business is improving (or declining). Having a business intelligence tool like this in your accounting software is certainly helpful.
Monitor key financial metrics within QuickBooks
Invoices
Xero only has 1 default invoice template, which is lacking compared to competitors that offer many different options. You can create your own custom templates though. Invoices are highly customizable: you can change the logo, font, colour, background, header, footer, and many other elements. Xero’s feature-rich strengths come into play here – you can set up recurring invoices to save time on billing, schedule automatic invoice reminders, send invoices in bulk, and set default payment settings for customers. You’re able to see when your customers have viewed your invoices. There’s even a live preview for invoices so you can see exactly what you’re sending.
Xero has a unique service called “Xero to Xero”, where you can easily send invoices to other companies that also use Xero. Do note that Xero to Xero invoices can’t be sent if your invoice has tax adjustments or credit notes. Xero only supports English for invoicing.
Create clean, professional invoices to send to your clients
Contact Management
Xero’s client management system is one of the most comprehensive in the game. On top of basic information like contact details, you can add discounts, and sales tax rates. You can even tag attachments to each contact (like legal documents, images, etc.) You can group different customers into “smart lists”. This allows you to target each group with different marketing offers. You can also send invoices to entire groups with a single click.
Payroll
Xero’s payroll add-onXero comes with payroll functions included, which is a nice touch. Most competitors charge extra for this function. You can schedule automatic wage payments (weekly, bi-monthly, monthly, etc.). You can pay employees specific amounts for the type and amount of work they do (e.g. software engineers who did both coding and graphic design for a project). You can also easily reimburse employees for work expenses.
You can also subscribe to Xero Payroll alone if you don’t want to use the full Xero package.
Manage your employees wages, taxes, leave schedules, and logged work hours
Client Portal
Xero offers your clients a clean-looking portal where they can view invoices. Your clients can pay you directly on the portal, and can also send you comments if they have queries or issues with your invoice.
Your customers can pay you directly via Xero’s client portal
Estimates
You can easily send professional estimates to your clients, which can then be converted into quotes when your client accepts.
Purchase Orders
You can create purchase orders. If your supplier ships your goods to you piecemeal, you can record how much inventory you’ve already received. You can convert purchase orders into bills.
Expenses
You can connect Xero to your bank accounts to enable “live” importing of transactions. When you connect your bank account to Xero, the software will automatically import your last 90 days of transactions.
Categorising expenses is easy with over 80 default categories to choose from. You can also create your own custom expense categories. Xero has a useful receipt capture function that allows you up to upload receipt images, with Xero automatically extracting key information like transaction amount and date from the receipt. You can then tag receipts to specific expense payments.
You can also create bank rules to automatically categorise your transactions. Xero uses machine learning tools to learn your categorisation patterns – the more use Xero, the better it gets at sorting your transactions for you. This is a big time saver.
Accounts Payable
Xero has an informative “Purchases Overview” dashboard that shows you all you need to know about your bills. You can view upcoming bills. There’s a well-designed dashboard that shows you all your vendors, your total purchase value, and your overdue, outstanding, and paid bills.
Inventory
Xero helps you track your inventory and displays basic information about your stocks. You can add inventory items with basic information like unit prices, descriptions, images, and notes. If you use Xero’s inventory tracker, you’ll be able to view helpful information like total stock value, average cost, number of items that you’ve committed in quotes, and number of items that you’ve ordered.
However, Xero doesn’t allow you to track negative inventory, so if you record the sale of goods before you’ve recorded their purchase you won’t be able to use this function. You can’t track components that make up final goods (annoying for manufacturers), and you also can’t track goods if you use periodic inventory methods (e.g. you only update at months’ end). Unfortunately, unlike with QuickBooks, you can’t set automatic re-ordering alerts when stocks are running low. If you need these functionalities, you’ll have to explore Xero’s app marketplace for third-party integrations.
Track inventory, and view important information about your supplies
Fixed Asset Management
Xero comes with this unique feature, which allows you to manage fixed assets. You can create different depreciation schedules: straight-line, declining balance, double declining, etc. You can also roll back depreciation. You can set up default disposal accounts when you need to get rid of your assets.
Manage fixed assets
Packing Slips
Xero doesn’t come with a packing slip function built in. You’ll have to download the Packing Slip template from Xero’s website. It would be easier if the platform came with this function as a default.
Project Tracking
Xero has all the industry-standard project features: managing team members, tracking individual hours allocated, and assigning invoices and other bills to projects. A nice added feature Xero has is project profitability tracking. This helps you prioritise the highest earning projects, and also enables you to quickly address margin issues that may occur with particular projects.
In terms of control over project costing, Xero allows you to set hourly cost rates for each staff member you assign to projects. You can also load your employee’s work hours into Xero Payroll to quickly calculate the wages you owe them which is a good time-saver.
Monitor all your projects conveniently
Time Tracking
Xero automatically reports time and costs into your invoices and accounting records. You can convert timesheets into invoices for easy billing. Like other time-trackers, there are automatic functions (start/stop button) and manual timesheet entries.
Budgets
You can create up budgets for various time horizons: 3 months all the way up to 2 years. You can compare these budgets with actual business performance to see how much you’ve beaten (or missed) targets by.
Outsourced Bookkeeping: Xero doesn’t have a “live” bookkeeping function like QuickBooks, but it does have an advisor directory where you can find a local accountant near you. You can then engage this accountant, and Xero allows you to give your accountant read-only access to your account so they can effectively manage your books.
Mobile Apps
Users often comment that Xero’s mobile app functionality is lacking compared to its desktop version.
Xero Customer Support
Xero’s after-sales support is where it really falls short, which is a pity given how robust the actual software package is. Customers have left numerous reviews citing poor support – long wait times for a response being the chief culprit. If Xero could invest more into supporting their customers, then the platform could really push past all its competitors.
Phone: Xero does not offer phone support. If you need to speak to someone urgently, you’re out of luck.
Email: Users have often reported having to wait for a day to get a response from Xero’s support team. Xero has a helpful function that allows you to give Xero support staff read-only access to your account, which helps them directly diagnose and solve whatever issues you might be facing.
Message: Xero has a live chat function, but it’s not located on the accounting platform – you have to go back to xero.com to access it. Users report the support representatives usually answered their queries well enough, but it’s puzzling why Xero doesn’t just include their live chat function within their accounting platform.
Documentation: Like its main competitors, Xero has an extensive base of online documentation. There are in-depth guides to all of Xero’s functions. There’s a community forum where users post questions and other users and Xero representatives will answer them, so you’ll probably be able to find an answer to whatever queries you have here.
There’s an FAQ, blog, and Q&A forum that helps users understand all of Xero’ functions, from the simple to the complex. There’s also a live “AI” chat that can answer basic questions like “how much sales did I generate last year” or “which payments are overdue”.
Videos: Xero has hundreds of video tutorials (called XeroTV) to help you navigate the platform.
Podcasts: Xero also has podcasts that feature business advice, like how to retain staff or how to build software businesses. I’m not sure if anyone really listens to these clips, but if you really want business-related audio playing while you’re on your morning drive, I suppose you could play this on your speakers.
Ultimate Verdict
Xero is a great online accounting software for small-medium businesses, especially for beginners just starting to use an accounting platform. Its features and UI are designed to let newcomers hit the ground running, so you won’t have to spend much time at all learning how to use the platform’s key functions. It’s a great choice for businesses that don’t need complex accounting features, but still want more functionality than more basic alternatives, like FreshBooks. Xero’s highest-tier plan also supports unlimited users, which is great for businesses that have lots of staff and are growing rapidly.
Xero’s customer support could certainly do with a good dose of improvement, and is really a pity given the polished quality of its product. This, and its lacklustre mobile offering mean that Xero still has a ways to go before it can claim to be the undisputed no.1 provider of online business accounting services.
In the grand scheme though, these drawbacks are not huge, and Xero’s many strengths certainly outweigh its few weaknesses. For any small-medium business that demands advanced accounting capabilities, strong reporting, a good user experience, and lots of users, Xero stands as a fantastic choice.
Ready to protect your business?
If you’re running a business, don’t forget to protect your company. Provide offers the best online business insurance. Get a quote within 60 seconds, and save up to 25% on your premiums. Have a look at our most common policies:
