Who can make a liability claim?

A number of liability cases have come to light in recent years, highlighting the importance of having business liability insurance.

Remember Jessica Wishart? This 22-year-old woman from Adelaide decided to sue McDonald's after a cup of coffee she purchased at one of its franchises left her with second-degree burns.

According to news.com.au, Ms Wishart accidentally spilled the cup of coffee on her lap while sitting in her car, which caused severe burns on her thighs. She has permanent scarring as a result of the incident and finds it difficult to walk, reveals the news source.

Mr Wishart's not the only person to make a liability claim against McDonald's. In the early 1990s, a 79-year-old woman from the US also sued the Golden Arches after she, too, received burns from a cup of coffee she had bought from one of its franchises. She was famously awarded $2.9 million in compensation - although this was later reduced to $500,000, states the New York Times.

Basically, anyone who suffers an injury or becomes ill in a public or private space and can prove the owner of that space was negligent in some way (i.e. responsible for their accident) may be entitled to make a liability claim.

All states and territories in Australia have their own regulations around liability cases and compensation, so it's important that you're familiar with the laws in your area.

As is evident from the two cases mentioned above, liability claims - when they're successful - can be costly. If you're not insured, you may be forced to pay compensation out of your own pocket, which could be devastating for your business.

Having liability cover as part of your business insurance package could be a lifesaver in such cases. For more information, get in touch with your local Elders Insurance agent.