Starting a New Company; What Insurance Does a Business Need?
If you’re starting a new business, it’s important to have the right insurance in place in case things take a turn for the worse. We’ve created a short guide on the basic types of insurance you’ll need to guarantee your business is protected.
Employers’ Liability Insurance
This is currently the only type of business insurance that is a legal requirement – and if you don’t have it, there can be huge implications for you and your business. If you have any employees (aside from family members), you’ll need at least £5 Million limit of indemnity to protect you against any potential legal outlays that come about from injuries or damage caused to your employees whilst working for you. Beware – there is legislation in place that could see your business fined up to £2,500 for every day you continue without this type of insurance.
Public and Product Liability Insurance
If your business will be welcoming customers onto your premises or if you’ll be visiting their premises, public liability insurance is worth considering. Its role is to cover any compensation claims made against you by someone who blames injury or damage on your business. For example, a customer could injure themselves slipping on a wet floor or a roof tile could fall onto someone’s car when you’re working on the building. The basic outline is the same for product liability insurance, with the only difference relating to the product being the cause of injury or damage. For example, if you sold a faulty toy that went on to injure a child; this type of insurance would protect your business by paying the costs of any compensation claim, up to your policy limit.
Building & Contents Insurance
If you own premises such as an office, factory or warehouse, you’ll need buildings and contents insurance. Buildings insurance does what it says on the tin – it will pay out in the event any damage is caused to your premises. If you’re renting your property, you’ll only need contents insurance (but check with your landlord first). If you’re planning on running your business from home, check your existing policies carefully – most standard home insurance policies don’t cover business activities.
Professional Indemnity Insurance
This type of insurance should definitely be considered for anyone providing a professional service for a fee. It is designed to protect you against compensation claims made by clients who may believe you have made a mistake in your work, for example breaching confidentiality regulations or infringing copyright. If a demand is made for compensation, professional indemnity insurance would cover any legal costs including compensation payouts.
For more advice please call us on 01604 904001 or email us on hello@waib.co.uk
