Public and product liability insurance in the UK deals with two kinds of third-party claim: harm caused by your business activities, and harm caused by a product you made or supplied. This guide uses gov.uk and Law Commission pages to show who can be liable for a product, why Northern Ireland sits on a separate track, and which dates in 2026 and 2027 could change the picture. We explain rules and do not recommend any policy.
Quick answer
Public liability insurance responds to harm from your business activities, and product liability insurance to harm from products you supply. Gov.uk says many businesses take out product liability cover, separate from general business insurance.
Public and Product Liability Insurance at a Glance
| Question | Short answer |
|---|---|
| What is the difference? | Public liability concerns your activities and premises, product liability concerns goods you supply |
| Who can be liable for a product? | Manufacturers, and sometimes others in the supply chain, under the Consumer Protection Act 1987 |
| Does gov.uk mention insurance? | Yes, it says many businesses take out appropriate product liability insurance |
| Is it compulsory? | We found no gov.uk page that makes it so |
| What is under review? | The Law Commission's product liability consultation, closing 14 January 2027 |
| Does Northern Ireland differ? | The EU Product Liability Directive applies there to relevant products placed on the market after 9 December 2026 |
| Which employer policy is separate? | Employers' liability |
Public Liability Against Product Liability
The two covers answer different questions. Public liability asks whether your activities or premises hurt someone. Product liability asks whether something you made, sold or supplied did. A shopkeeper whose customer slips on a wet floor has a public liability question. The same shopkeeper selling a faulty kettle that burns a buyer has a product liability question.
Gov.uk is explicit that the two are not the same. Its product liability and safety page says many businesses take out appropriate product liability insurance, and adds that this is not the same as general business or employer's liability insurance. Some sellers package the two covers together and some do not, and we did not find a regulator page that says how they must be packaged. The so what: never assume one policy name covers both, and ask for the section that deals with products.
What Gov.uk Says About Liability for Products
The gov.uk product liability page, which shows a last update of 21 July 2026 and a later metadata timestamp of 14 October 2026, says that manufacturers, and sometimes others in a product's supply chain, are liable under the Consumer Protection Act 1987. It says that if a product is unsafe and causes personal injury or death, you could be sued for compensation. The page does not discuss time limits.
A separate gov.uk guidance page says the General Product Safety Regulations 2005 require all products to be safe in normal or reasonably foreseeable use. It applies to businesses that make, import, distribute or sell consumer products, and it says they are all responsible for their safety. Manufacturers and importers must also keep technical records, label products and provide safe-use instructions. The page shows a last update of 21 July 2026.
The pattern is a layered duty. The safety rules say what a product must be like when it is on the market, and the liability rules say who pays when it hurts someone. Insurance sits behind both, and it responds to claims that fall within its wording, not to regulatory breaches as such. Our hub guide explains how the covers fit together.
Who in the Chain Can Be Liable for a Product
The existing law names manufacturers first and "sometimes others" after. The Law Commission's proposals would be more specific. The table sets out what the two sources say.
| Party | Gov.uk, current position | Law Commission proposals (consultation) |
|---|---|---|
| Manufacturer or producer | Liable under the 1987 Act | Existing position kept, with a wider definition of "product" |
| Others in the supply chain | "Sometimes" liable | New categories of potentially liable persons |
| Fulfilment service providers | Not named | Named as a new category |
| Online marketplaces | Not named | Named as a new category |
| Overseas producers | Not named | UK authorised representatives named as a new category |
The proposal column comes from the Law Commission's project page, which lists these three as "new categories of potentially liable persons". The Commission's list is a consultation proposal, so none of these roles is liable on that basis today. The so what: if you sell through a marketplace, fulfil orders for others, or import, check whether your insurer treats those roles as covered, and in which words.
Great Britain and Northern Ireland on Two Tracks
The gov.uk liability page notes that the EU Product Liability Directive will apply in Northern Ireland to relevant products placed on the market after 9 December 2026. For a business that trades in both parts of the UK, this means one product could be under two liability regimes.
Picture a homeware seller based in England who ships to customers in Northern Ireland. For a product placed on the market after 9 December 2026, the seller may need to ask which regime applies to each sale. We cannot answer that from the pages we read, and we do not offer legal advice. The question to put to an adviser and to the insurer is whether the policy territory and the policy wording reflect that split.
Mapping Your Role Before You Ask for Public and Product Liability Quotes
Insurers and contracts describe roles in their own words, so it helps to settle your role first. The roles below are the ones the gov.uk safety page names (make, import, distribute, sell) plus the three the Law Commission proposes to add. The table is a worksheet of ours, not an insurer's form, and the answers are yours to fill in.
| Role | Do you do this? | Where to check the policy wording |
|---|---|---|
| Make a product | Business description and products section | |
| Import a product | Territory and business description | |
| Distribute or sell a product | Business description | |
| Fulfil orders for others | Business description, any exclusion | |
| Sell through an online marketplace | Contract terms and the policy territory | |
| Act as an authorised representative | Ask the seller directly |
An empty answer is not a problem. A ticked answer that the quote does not mention is the one to raise with the seller before you pay, because the Insurance Act 2015 duty of fair presentation, which our hub guide describes, puts the burden on you to describe the risk fairly.
What Public and Product Liability Insurance Does Not Change
Insurance does not remove a duty. The gov.uk safety page says manufacturers and importers must keep technical records, label products and give safe-use instructions, and a policy does not do that work for you. Gov.uk presents product liability insurance as something many businesses take out, which is a different thing from a duty to be safe.
Picture a small business that sells home-assembled gift sets from its own website and through a marketplace. The business can read the safety page, keep its records, and label what it sells, and still hold a policy with a products section. The records, labels and instructions are the compliance side. The policy is the money side if a claim arrives. Neither replaces the other, and a quote for public and product liability insurance describes only the second.
The Law Commission Review
The Law Commission's page says its consultation opened on 8 October 2026, runs until Thursday 14 January 2027, and that it anticipates a final report in late 2027. The page also records that its terms of reference were published on 8 December 2025. It shows no separate last updated date, only those dated entries. A final report is a set of recommendations to government, and the proposals below are provisional. No law has changed.
| Provisional proposal | What it would do |
|---|---|
| Wider "product" | Cover software, AI systems, and design components and features of online platforms |
| Wider "supply" | Count a product as supplied however delivered, including by download |
| Defect test | Provide a clearer, more structured framework |
| Evidence | A rebuttable presumption of defect, plus a risk-sharing mechanism, where evidence is exceptionally difficult |
| Psychiatric harm | A new framework for compensation |
| Property and data | Compensation for property used privately and professionally, and for destroyed or corrupted data |
| Defences | Existing defences kept, updated for digital products |
| Long-stop | Reset after substantial modification by a producer, and 25 years for latent harm |
The so what for an insurer's customer is that several rows widen who or what can be pursued: software, downloads, platforms and data. A policy written around physical goods may be silent on some of these. The consultation is the moment to ask your adviser how a future change could meet your wording at renewal.
A Product Seller's Questions on Public and Product Liability Insurance
Use the list below for any quote that mentions public and product liability insurance. It does not tell you what to buy.
- Does the policy have a products section, and what does it call it?
- Does the limit for products sit inside the public liability limit or separately?
- Do the wording and territory match where my goods are sold, including Northern Ireland?
- Does the description of my business include importing, fulfilling or selling online?
- Are claims arising from software or digital products treated differently?
The fifth question looks ahead to the Law Commission's proposals, which cover software. If your goods include software or smart features, ask how the insurer describes them. Our cost guide explains how the description of the business moves a premium, and our requirements guide covers the contracts that ask for cover.
Product Safety Reform Is Also Moving
Beyond liability, product safety law is being rebuilt. A Faegre Drinker note dated 13 May 2026 says the Product Regulation and Metrology Act received royal assent in July 2025. It says a public consultation on product safety reforms was due to end on 23 June 2026, and that the government planned to publish its response in the autumn of 2026. The reforms it describes aim at responsibilities throughout the supply chain, including for producers, distributors and online marketplaces. That is a law firm note, and we have not found the government's response, so we cannot say what was decided.
The so what: safety duties and liability for harm are separate tracks that happen to name some of the same roles. A change on either track can alter what a customer or marketplace asks of you, so keep both in view at renewal.
What Is Moving Into 2027
| Date | Item | Source |
|---|---|---|
| 23 June 2026 | Product safety consultation due to close, with a response expected in autumn 2026 | Law firm note |
| 8 October 2026 | Law Commission consultation opens | Law Commission |
| 9 December 2026 | EU directive applies in Northern Ireland to relevant products | Gov.uk |
| 14 January 2027 | Law Commission consultation closes | Law Commission |
| Late 2027 | Law Commission final report expected | Law Commission |
Where to Go Next on Cairn Cover
The one thing to remember about public and product liability insurance: they are different questions, and your policy should say clearly which one it answers. Cairn Cover is a free guide and does not sell insurance or quote prices. Read the what is it guide for the basics, and the 10 million guide if a contract names a high limit.
Frequently Asked Questions
What is public and product liability insurance? It combines cover for third-party harm from your activities with cover for harm from products you supply. Gov.uk says product liability insurance is different from general business insurance, so check that your policy includes a products section.
Who is liable for a faulty product in the UK? Gov.uk says manufacturers, and sometimes others in the supply chain, are liable under the Consumer Protection Act 1987. The Law Commission is consulting on adding more parties, such as online marketplaces.
Is product liability insurance compulsory? We found no gov.uk page that makes it compulsory. The page says many businesses take out appropriate cover. Contracts with retailers or platforms may require it, so read yours.
What is the Law Commission reviewing? It is consulting on changes to product liability law, including a wider definition of product that covers software. Its consultation runs until 14 January 2027, with a final report expected in late 2027. No law has changed yet.
Does the EU directive affect UK sellers? Gov.uk says it will apply in Northern Ireland to relevant products placed on the market after 9 December 2026. Whether it affects you depends on where you sell, so ask an adviser.
Does public liability cover products? Not by default. Some policies include a products section, and some do not. Read the schedule and wording.
What should a product seller ask an insurer? Ask whether the policy has a products section, how its limit works, and whether it covers the places and channels you sell through.
How does Cairn Cover help? We read government and Law Commission pages, date them, and link them on the words they support. We do not sell insurance, quote prices or rank providers.