Almost every business will need to buy insurance for their company. This then forms a contract between the insurance company and yourself. In return for a payment or a small regular premium, the insurance company should pay out a sum of money to you – the insured, should a specified event arise in the future. Insurance cover therefore reduces the risk of damage to your business imposed by outside and sometimes internal events. Whilst some insurance cover is by choice, others are compulsory: Compulsory insurance cover for businesses.
Employer’s liability insurance
For most types of businesses, a figure of £10,000,000 or more would be purchased to cover employees during working hours.
Professional indemnity insurance
Certain professionals and businesses – such as accountants, lawyers and companies offering financial services, are legally required to take out a professional indemnity policy. The business and its people are consequently protected against negligent practices and incorrect advice. If you are unsure whether this type of cover is compulsory for your area of expertise, then it would be wise to get in touch with the trade association or professional body that governs your line of work.
Any vehicle that belongs to a company must carry at least third party insurance cover. This protects the company and people against claims made for personal injury or damage to property. Fully comprehensive insurance would also protect the company’s own vehicles if involved in an accident. For employees who use their own vehicles for business purposes, their insurance broker must be informed and the use of the car documented – and sometimes charged extra for.
Insurance cover to consider for your business
Buildings and contents – all risks
This type of cover is there to protect you from numerous risks including flood damage, fire damage to contents/ building and theft. The level of cover will depend on whether you lease the building from a landlord or own the building yourself. It will also depend on the value of the contents inside.
Goods in transit
Should you need to transport goods by transport or send with a courier, then you would be protected from loss or damage to the goods.
Equipment insurance cover is there if you should need to replace a piece of equipment through damage or theft. It will however take into account the age of the equipment and any wear and tear. Also available, are polices to protect your IT apparatus and machinery against breakdown.
If you suffer a disaster such as fire or flood, then you are protected through loss of business directly affected by this.
For yourself or any of your staff who may need to visit abroad for business purposes.
With the current climate being one of a recession, some businesses are finding it hard to keep their companies going and could find them themselves in a position where they are unable to pay monies owed to you. You would be covered should they become insolvent, but will have to bear some of the cost yourself. Credit insurance certainly is not compulsory insurance cover for businesses, but depending on how much credit your company offers, it may be worth considering.