Business insurance is essential to offer protection for all types of business from the larger company to the small one person business. Whether you are a shop owner or a large company trading into the millions, all businesses need insurance.
Business insurance can cover the basics from liability insurance for employers and employees as well as buildings, stock and business interruption insurance.
Some business insurance is required by law and some is for sensible protection. As will all the expenses of setting up a business, it is always very tempting to have the minimum of business insurance or in some cases to tempt fate and not to have adequate business insurance cover.
Whilst this seems tempting it is a false economy and all business start ups should have at least the legally required insurance and a modicum of business insurance to adequately protect your liabilities and risks. Setting up in business is a risk in itself and a calculated gamble. If things should go wrong in the early stages, through no fault of your own, then you could end up losing a lot more than the existing business.
Business insurance falls into 3 categories:
- Property and Buildings;
- Business Assets & Equipment [stock and contents].
Starting with liabilities:-
As soon as one person is employed in your business then it's the law to have Employers Liability Insurance. The minimum level is £10million of cover for personal injury, illness or disease sustained during the course of employment.
Public Liability - this is business insurance to pay for any damages upon bodily injury, illness, or disease caused to a member of the public, who is not an employee, that visits your business premises. This policy would also indemnify you the policy holder against loss or damage to the property belonging to a member of public.
Product Liability is your legal requirement to pay for damages to a member of the public or customer who suffers damages due to a defective product you have supplied.
Professional Indemnity - this has become a necessity in our increasingly litigious times, when businesses can be sued, rightly or wrongly, for a vast range of damage claims and complaints from consumers and third parties. This is particularly important if you are giving advice of any kind and offering a consultancy service or design service, as your customers would be making financial decisions based upon your advice.
If you are the key man or key woman in your business and without you the business will grind to a halt or be severely impaired, then you could consider Key Man Business Insurance. This type of cover can't replace you or a key member of staff but it can offer short term financial help to reduce the impact should that key person be unable to perform their duties.
Business Interruption Insurance, when you are unable to trade due to problems with your premises or place of work, can provide loss of business income benefit.
If you are transporting goods then Goods in Transit business insurance will cover your goods against loss or damage while in your vehicle or when sent by courier. If your business is in manufacturing, you will need to insure machinery and stock.
All businesses need to insure buildings and property that can be removed or damaged against the conventional risks, such as fire, lightening, storm, flood, and even explosions of Gas or Boilers, damage caused by vehicles, impact by aircraft, riot and sprinkler leakage.
Larger businesses need individually tailored insurance programmes. If your business insurance exceeds £5,000 you should consider talking to a commercial business specialist broker so as to obtain the very best terms. As a commercial enterprise you must ensure that your insurance meets your needs and risks and complies with the ever changing demands of the UK and EEC Law.