Public liability insurance and street parties

Knowing your neighbours is core to a community and meeting in the street right outside their houses is the best way of achieving this. Such events promote social cohesion and community development.

Neighbours’ street parties are defined here as:

• organised and funded by residents
• with only about 40 – 200 people attending
• without external publicity
• in a single or linked couple of streets
• rarely having any structures such as stages
• normally not involving the sale of anything
• not requiring a Temporary Event Notice or other licence

We recommend that councils do not ‘require’ butmay ‘recommend’ Public Liability Insurance (PLI) for road closures etc. for these kinds of street parties and make a clear distinction with larger publicly advertised events, outside the above definition, which would require PLI. The cost of the premium is prohibitive to many communities and may not deal with the liability and ‘duty of care’ issues that councils may be concerned about.

In 2012 for the Jubilee about 2m people took part in street parties. Some of them had insurance cover but there were no claims at all made in the country, according to the insurance companies.

Why Neighbours’ Street Parties should not normally be required to have Public Liability Insurance

1. Costs

Having to pay £50+ for an insurance premium discourages all but the wealthiest of residents from having a neighbours’ street party and is an obstacle for most communities. As a result, councils are requested to support these important community building events by not routinely requiring PLI as part of arranging temporary road closures. Many councils in the UK already have this policy and this can be viewed as best practice.

2. The authority is Not Responsible for the Event

By making a road closure order the authority is not itself licensing or approving any aspect of the event itself. To meet their ‘duty of care’ many councils ensure that residents are aware of their responsibilities and minimise any risk or attempt of a claim against the council, by requiring residents to agree by signature to conditions, written in plain English, on behalf of the other residents. (Examples are available – please ask).

Any event PLI does not indemnify the authority from anything it may be negligent of, regarding for example, in cases of slipping or tripping on faulty pavements or as a result of the road closure order itself. Indeed, in any serious cases there could be a risk of ‘double insurance’ with its own PLI.

However, where community workers linked to organisations such as housing associations or the council are clearly involved, they may feel it necessary to arrange and fund PLI, though not as a requirement of the road closure. Wealthier residents may take out PLI at their own volition.

3. The Risk of Liability Is Low

We have not to date heard of a single claim for compensation or negligence being made from a council as a result of the road closure being given for a street party, as defined above.

This is because the very nature of street parties means that they are very low risk in terms of the potential of a claim being made on the council or authority, for the following reasons:

• The activities at street parties are very modest.
• Most residents attend the event and all activities are very visible for all to see and so easily controllable.
• This self-organising approach means that there is a very high sense of self-responsibility taken by residents because they share the arrangements between them and rarely do people from outside the street attend as there is no external publicity.

For the same reasons, the chances of an incident needing cover of £5m is negligible – i.e. this value would cover at least 2 deaths and legal costs.

4. Validity and Risks of Insurance

The terms of PLI often do not protect councils or residents from liability or accident, and it is questionable that PLI is fully valid for street parties for the following reasons:

• PLI often excludes damage to property not belonging to residents (including to the highway, street furniture and vehicles), from wilful or malicious acts or theft, or during ‘setting up’ and ‘taking down’ the event.
• The insurance may not be valid for what are often not-constituted groups, without written records or ‘officers’ etc. The organising of the event is shared out and usually not recorded. Though insurance companies would sell a policy to an individual or ‘residents of the streets’, the problem may come if there was a large claim, for example for serious injury. The application forms and ‘small print’ are unlikely to be carefully scrutinised by the resident applicant or the Council officer.
• Inflatable equipment such as bouncy castles and its users are usually excluded from PLI.
• Event insurance usually excludes other ‘contractors’ such as entertainers or performers and requires them to have their own insurance.
• Insurance does not prevent any damage to person or property. It may even give the residents a false sense of security. It is more appropriate for councils to suggest that residents manage any risks.
• Having insurance may encourage people to make a claim or exaggerate an incident when without insurance they may not.

5. Policy

Blanket requirements for insurance and inflated levels of cover are counter to the Health & Safety Executive’s ‘Sensible Risk’ campaign that is supported by the Local Government Association. These tend to be supported by government policies to reduce our Risk Averse society.

Also, the Compensation Act 2006 recognises the ‘deterrent effect [on benefits] of potential liability’.

In conclusion, taking a considered and risk / benefit assessed approach to liability, many councils have found that a blanket requirement for PLI is inappropriate and not necessary for road closures for most small street parties.

Important – This advice note does not constitute a complete analysis of the issue, nor provide a complete list of organisational arrangements, responsibilities or liabilities for planning a street party or event. If any person has any doubts or questions about the need for public liability insurance for a street party, or any other event, they should seek independent professional advice. We do not accept any responsibility for any event that we are not directly responsible for organising.