For ease of reference, business cover is divided into four main areas: legal, financial, employees and property.
Employers' Liability Insurance
If you hire employees, even on a part-time or temporary basis, you are legally obliged to have liability insurance cover. This would typically be for £ 10 million. It protects your business against any claim that may arise as a result of any of your staff injuring themselves on your premises or while working for you. No matter how stringent your health and safety strategy may be, something unforeseen can always happen, so it pays to ensure that your business is adequately covered in this area. Remember something as simple as someone tripping over a loose cable in an office could result in a serious injury claim.
Public Liability Insurance
If you invite customers onto your premises, then you need public liability insurance, even though it is not a legal requirement. It protects you against claims made by members of the public who have suffered injury or damage to property in connection with your business. If someone slips on a wet floor on your premises, for instance, you may be held responsible, and claims of this type can run into tens of thousands of pounds. Some customers or clients may require you to present proof of public liability insurance before they work with you. This is particularly common when dealing with public bodies and large corporates.
Product Liability Insurance
This protects your business against compensation claims from anyone harmed or whose property is damaged due to a defect in one of your products. This could be through design, manufacture or supply. Remember, it pays to cover all eventualities.
Professional Indemnity Insurance
Sometimes mistakes will happen, so Professional Indemnity Insurance protects your business in the event of a claim made by a client (or third party) suggesting they have suffered a loss as a result of non-performance or professional negligence in the services you provided. If your business centres round sharing or selling your knowledge and expertise to your clients, then you need to protect yourself from potential claims that your knowledge or advice has in some way damaged their business. They may also look to make a consequential claim which relates to your advice leading to unexpected costs to them that they may seek to recover from you.
Directors and Officers Insurance
Directors’ & Officers’ (D&O) Liability protects the personal liability of the directors, officers and senior management against claims arising from decisions and actions taken whilst managing the business in the scope of their senior roles.
Corporate Liability or Entity cover (for the firm itself) extends the cover under a D&O policy to include the company or organisation itself.
Company Employment Practice Liability extends the D&O and Corporate Liability/Entity cover to include lawsuits and liability in respect of an alleged employment practice violation e.g. unfair dismissal, sexual harassment, failure to promote based on racism, emotional distress, etc.
Legal Expenses Insurance
You may need to defend your company against legal action not covered by the liability insurance mentioned previously. This could be due to an employee suing you for unfair dismissal, for example, or claims of intellectual property infringement, contract disputes or data security breaches. In such cases you can take out a legal expenses policy to cover any costs incurred in defending yourself or for compensation you may have to pay.
Cyber Liability Insurance
Internet technology has changed greatly during the last 20 years, so much so that few businesses remain unaffected. From email to websites used to purchase goods online, technology is everywhere. A cyber-attack that brings your site down could result in costs in repairing the site and potential loss of profits. It is also important to protect customer data as this is now a tradable commodity. Online forums, chat rooms, blogs and even emails can result in claims for libel and defamation. A cyber liability policy can be used to cover your own and also any third party losses.
Business Interruption Insurance
Incidents such as storm, fire, flood or burglary cannot only damage your premises and equipment, but also disrupt your operations. The same goes for a businesscritical computer system crash. Any gap in your ability to serve customers or deal with staff and suppliers is likely to have major financial implications, and business interruption insurance helps you protect your business against such a scenario. Every business interruption claim lasts a different amount of time so we will work with you to identify a suitable period required for your trading conditions to return to normal.
Virtually every business will handle money in some way, whether it is the form of cash, cheques, credit card slips or bankers’ drafts, making this form of insurance extremely important.
Different limits will apply to money left on the premises in and out of business hours, in safes, at the homes of directors or employees and in transit.
Trade Credit Insurance
You can protect your company from bad debt resulting from the insolvency or bankruptcy of your customers by taking out a trade credit insurance policy. This can be particularly important to small and medium-sized companies, which can be forced out of business if a major customer fails to settle their bill. While this type of insurance will not necessarily cover the full value of an outstanding debt, it will pay out a percentage. This usually ranges from 75% to 95% of the invoice amount, but may be higher or lower depending on the type of policy.
Key Man Insurance
You can use this kind of policy to protect your business against a key member of staff dying or falling ill and the business being adversely affected by the resulting skills gap. This is particularly important for small to medium-sized businesses, which have less potential to provide adequate cover for the absence of influential people.
Employee Protection Insurance
Rather than relating directly to the business, this kind of insurance provides cover against risks to individual employees. Anyone who is self-employed or runs their own business will be only too aware that any absence from work will have a direct effect on their income, and prolonged periods of absence will have a significant impact. Consequently, there is a range of options that provides compensation depending on the reason for a person’s inability to work. These can be taken out by individuals or offered by employers to their staff as part of a job package. They range from personal accident and sickness insurance and income protection insurance, which help provide an income in the event of accident or sickness, to private medical insurance and life insurance.
Other types of insurance to consider are:
• Personal accident and sickness insurance
• Income protection insurance
• Private medical insurance
• Life insurance
• Stakeholder Pensions
Buildings & Contents Insurance
Your business premises and equipment can be insured against a range of eventualities. These include the effects of the more obvious dangers of theft, fire, storm and flood, as well as the more unusual risks such as explosion, riot, malicious damage, water damage from leaking tanks, pipes and sprinklers, and impact by aircraft, road and rail vehicles. You will need to consider carefully the range of ‘disasters’ that could hit your business and ensure you guard against both the common and the unexpected. You can get specific buildings and contents insurance depending on the nature of your premises and property, such as glass insurance and frozen food cover. Theft-only insurance Although your contents insurance will cover you against theft, providing you can show there has been forced and/or violent entry to or exit from your premises, theft by your own employees is unlikely to be covered. For this reason, specific theft insurance should be seriously considered if you stock high-value or desirable materials or products.
Engineering Breakdown & Inspection Insurance
This type of cover protects you against electrical or mechanical breakdown for most types of equipment and machinery, including computers. Under engineering failure insurance, many items of plant, such as boilers, lifts and lifting machinery, are required by law to be inspected regularly by a qualified person to ensure they are in sufficient working order to be covered by the policy.
If your business runs a fleet of vehicles, you are legally bound to insure against injury to others and damage to their property arising from them when they are out on the road, just like you would for your own car. Although you can simply take out a policy for third party, fire and theft, comprehensive cover would be more appropriate as maintenance of the fleet is likely to be critical to your business.
This is essential cover for any business that transports stock, goods, tools or materials on a regular basis. Goods in transit insurance will ensure that your goods are covered against accidental damage or theft that could occur while they are in transit, providing you with complete peace of mind when your goods are on the move.
Should you require any further detail, please call us on 01633 213063 or email us using the box below.