Different Types of Business Insurance

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Buying a Business - Business Insights

Different Types of Business Insurance

When you start a new business it is important you take out the right insurance to protect your business. While by law the only insurance you need is employment liability insurance. It might be worth looking at other forms of insurance. In the latest business insights, we will be going over some important insurance policies worth taking out for your business.

Employers Liability Insurance

By law, every business has to have this insurance. Under the Employers’ Liability (Compulsory Insurance) Act 1969 it is mandatory for a business to have this insurance. 

This is insurance essentially covers any compensation and legal fees when an employee takes out a claim against the business. 

These claims are reserved for any injuries or illnesses sustained while within the workplace. When it comes to employers liability insurance, not having a cover in place can land you a fine of up to £2,500 a day.

Professional Liability Insurance

This insurance is not a legal requirement but is especially important if you provide services and you work directly with clients. Professional liability insurance will cover you against any claims made regarding the service you have provided a client. 

These claims are usually because the service you have provided has caused financial harm to your clients business. Or if you have failed to carry out the service that was agreed. Other reasons could be claims against misrepresentation, poor advice and negligence.

What is usually covered with professional liability insurance is usually legal and court fees. Also, some of the damages could be covered too. Although generally it is not required of most businesses to have this insurance it is sometimes required of businesses that are within the legal and health industry.

Property Insurance

Just like when you buy a new house, property insurance is crucial when it comes to protecting the building you work in. 

Otherwise known and business property insurance. This is the insurance you take out to protect the building from any damage caused. 

These damages can be caused by a range of factors. Typically these accidents could be fires, faulty wiring, leaky roofs, there is an abundance of issues that could cause physical damage and force the closure of your business.

Business property insurance will help to cover you for any damaged goods caused by these accidents. Depending on what you have listed on the policy, you could have everything replaced by your insurance. Additionally, this insurance covers any repair costs incurred.

This insurance will also protect you from theft and damages caused by a force of entry i.e from a burglary. When taking out a business property insurance, your location and business type should be considered in order to protect you with the right policy. 

An example would be if you own a shop you may need to tailor your insurance to cover any theft of stock or damage caused to customer belongings. 

Product Liability Insurance

If your business sells goods and products to customers then a good move would be to take out product liability insurance. 

This insurance will cover the costs of any claims made against the quality of any products sold to a customer. Now should you sell an item to a customer and this item then injures them? They are within their rites to take out a claim against your business for selling them a dangerous product.

As a business owner, it is your responsibility to ensure everything you sell is of the standards set out especially when it comes to making sure they are safe. Not having this insurance can land you in deep water when it comes to legal fees and damages.

Product liability insurance will cover those costs and compensation. This insurance is especially important for manufacturers of products. As they could fall into trouble with both their customer and the customer of theirs, for selling a product that has not met health and safety standards.

Public Liability Insurance

When running a business it is also very important to consider protection for when a third party injured on the work premises. These third parties are usually customers of those wanting the service or good you are providing.

If a member of the public is injured or in a worst-case scenario dies whilst on your business premises. You can expect to receive a compensation claim.

Public liability insurance will cover you for any legal fees, compensation, medical treatment and transportation costs that can be incurred by health services for the person involved.

This type of insurance is typically important for businesses such as nurseries and schools, where you are having to deal with a lot of third party members. Such as children and parents. Having this cover will protect your business financially as compensation can be quite high. Also, you want to protect the general public against any difficult circumstances caused by your business.

Fleet Insurance

Depending on the type of your business. You may be required to have multiple vehicles in order for employees to do their work. 

Fleet insurance is for when you need multiple vehicles covered under one policy. Fleet insurance can be taken out for as little as 2 cars. It is important to have fleet insurance to ensure that all your vehicles are covered should any accidents happen on the road.

Also with fleet insurance, you can typically insure multiple drivers on the same policy. Most policies are tailored to suit your business model and your employees.

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