Plumber, painter, accountant, doctor – different trades, one shared question: who steps in if the work causes damage to someone else? That's what liability insurance is for.
Plumber, painter, accountant, doctor – different trades, one shared question: who steps in if the work causes damage to someone else? That's what liability insurance is for.
“Liability insurance” – one term that actually covers at least four different products. If you don't know which is for what, it's easy to end up with a policy that misses precisely your biggest risk. This key article lines up the four cover families side by side – illustrated through our four recurring characters.
This is the backbone of hands-on trades. A bucket falls off the painter's scaffold, the plumber forgets to shut off a valve, a customer trips over the toolbox: bodily injury and property damage caused to someone else in the course of the work is the territory of public (also called general) liability insurance. The injured party can be the client, but just as easily an unrelated third party – a passer-by in front of the shop window, or the neighbour downstairs.
The accountant's, designer's, IT developer's or consultant's mistake typically doesn't break or leak: it adds up. Two points are worth keeping distinct here: a fine imposed on the client because of the professional error can arise as the client's own loss, claimable as a pure financial loss; a fine or penalty imposed on the insured personally is typically excluded under the policy terms. This is what professional indemnity insurance is for, and it typically works on a claims-made basis – the article on the retroactive date explains this feature, because continuity when switching insurers depends on it.
Primary liability for damage caused by a defective product rests with the manufacturer and the importer; the distributor – a webshop included – is typically liable only if it cannot name the manufacturer, the importer, or its own supplier. The precise rules are set out in the laws in force – and these are changing: for products placed on the market after 9 December 2026, the transposed rules of Directive (EU) 2024/2853, the new EU Product Liability Directive, will apply, and they also widen the range of liable parties, for example to include logistics service providers and online platforms. This cover touches a wide range of businesses, from joinery workshops to webshops; the details are in a separate article: product liability, from manufacturer to webshop.
The fourth family looks inward: if your own employee suffers a workplace accident, they can bring a compensation claim against you as the employer – Hungarian labour law is strict on companies here. This is not the same as accident insurance provided to staff as a benefit; the article on employer's liability clarifies how the two relate.
Typically not just one, but a combination that fits your activity: a contractor needs public liability + employer's liability, an accounting firm needs professional indemnity + office public liability, a manufacturing tradesperson needs public liability + product liability. The boundaries depend on the policy terms – which cover a given loss falls under is determined by the insurers' current contract terms. The Coverage page helps you put together the right combination, and the Professions page articles give the profession-specific picture.
Four questions, four directions. Do you work on other people's property, near their equipment, or do customers visit your premises? If yes: public liability. Does your work produce advice, a design, a calculation, a document, software – anything whose error could cause a loss measurable in money? If yes: professional indemnity. Does a product leave your hands and stay with the buyer? If yes: product liability. Do you have employees? If yes: employer's liability. Most businesses end up with two or three “yes” answers – and that's exactly normal: a good programme isn't one product, but a combination tailored to your activity. The detailed process is covered in the activity assessment article.
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