Who needs business insurance?
If you are a business owner, sole trader or contractor you should have business insurance to safeguard you against a range of potentially serious risks. Every industry or business will have unique requirements depending on whether they own commercial property, manage their own stock, employ staff or have invested in physical assets such as office furniture, company vehicles etc.
What business risks should you insure against?
There are many risks that can lead to business disruption or result in devastating losses for both self-employed individuals and companies. Some of the common risks include natural disasters, theft, damage to stock, criminal cyber activity, injury or property damage, health and safety breaches and employment disputes.
What types of insurance are there?
Insurance policies will differ between businesses and industries so it’s important to know exactly what insurance cover you need. In addition, it’s unlikely a single policy will provide risk protection against all eventualities so you may need to take out more than one.
A good insurance broker will be able to advise what policy options are available to deliver the right amount of cover for your business, and find you the best possible option through their industry relationships with a wide range of insurance providers.
The following are the most common policies businesses should consider taking out.
Material Damage Insurance
Insuring your assets will protect you against theft and damage to items you own and use for work, for example buildings, office furniture, hardware (computers, mobile phones etc.), tools and stock.
Your assets should also be insured against damage from natural events such as a flood. Not all policies will provide cover for earthquakes so it’s important to discuss this with your broker, especially if you live in parts of the country where there is a higher level of risk.
Additionally, if you run your business from home then it’s a good idea to check whether your household insurance covers your business assets, as sometimes it doesn’t.
Business interruption insurance
In the event that your business cannot operate due to unforeseen circumstances included in your policy conditions, Business Interruption insurance can cover loss of profit for a pre-agreed period of time. Cover can also be arranged for loss of rents if you are a property owner. It is important to note that a Business Interruption claim is “triggered” by loss or damage under a Material Damage policy e.g. damage to your business premises by an insurable event such as a fire.
Liability insurance is a must for most businesses, and there are various types of cover available. All businesses should have Public Liability insurance to cover their legal liability for damage to third party property; e.g. damage to a site you are working on or the premises you rent.
Your business will also have additional exposures specific to your industry. For example, businesses offering professional services and advice will likely need to hold Professional Indemnity insurance, and contractors and tradesmen need to have sufficient Statutory Liability cover to respond to claims made under the Health and Safety Act.
Cyber security insurance
With an increasing number of companies coming under attack from hackers and cyber criminals, the need to insure against these exposures has never been more important. Cyber insurance can provide cover in the event of privacy breaches, system damage, transmission of a computer virus and in some cases lost profit.
Other types of insurance
There are numerous other risks that a business can insure against; for example damage to company vehicles, marine cargo or travel exposures, or loss of a key member of staff.
How can an insurance broker help with my business insurance?
Knowing what you should be insured for can be challenging for most small businesses. That’s where a great insurance broker can be invaluable.
They will be able to assist you in accurately assessing your risks by helping you work out the value of your assets, looking at your current financials including profit margins and projected earnings, reviewing your business processes and discussing your previous insurance history including any previous claims you may have made.
To find out how an insurance broker can help you with your business insurance,
contact your local broker today.