Insurance is arguably one of the most boring things to spend your hard earned money on. You buy it because you want to be on the right side of safe, and then you go a whole year without needing to claim and you start to wonder about life on the other side…
You start to think about all of the other things you could have spent that money on – a fab new pair of shoes or a night on the tiles. You don’t even know what your policy covers anyway and so is there any point in buying it in the first place?
Well, ultimately only you can decide that but to help give you the information you need to make that decision, read on to find out what you’re actually spending your money on.
Types of Insurance Available
There is a bewildering number of products on the market but not all of them will apply to you and even if they do, you don’t have to buy all of them (unless there is a legal requirement to do so). Typical business insurance is composed of the following;
- Public Liability Insurance
- Professional Indemnity Insurance
- Premises/Shop Insurance
- Employers Liability Insurance
- Business Interruption Insurance
But wait, I still don’t know what I’m buying!
Let’s explore what they each do, who might need to consider purchasing them and what kind of loss they might cover:
|Policy||What it does||Who it’s for||Example of a claim|
|Public Liability||Covers you if a member of the public or a customer suffers loss or injury as a result of your business||Essential for most businesses. Not required by law but is mandatory if working for a local authority||A customer visits your shop and slips over. Customer sues you for £50,000. Your policy pays compensation and legal fees.|
|Professional Indemnity||Covers you if your customer loses money as a result of a mistake that your business made.||Best suited for businesses that give advice, offer a professional service or handle data belonging to a client.||You accidentally send a sensitive e-mail to the wrong recipient. Your client sues you for breach of confidentiality. Your policy pays for the claim and legal fees.|
|Premises||Covers your business premises and stock, contents and fixtures & fittings against theft / damage.||Anybody who owns / rents a commercial property to run their business from.||A fire starts in your warehouse overnight and burns down the building and all of your stock. Your policy rebuilds and indemnifies lost stock.|
|Employers Liability||Covers you against claims from employees who become sick or injured as a result of working for you.||Anybody who employs staff. THIS IS A LEGAL REQUIREMENT AND IS NOT OPTIONAL. The fine for not buying it is £2,500 per day that you do not have it.||You employ a contractor to help you fit a roof. He slips off and breaks his arm, suing you for loss of earnings. Your policy covers the claim plus legal fees.|
|Business Interruption||Covers you for loss of income for periods you are unable to earn money due to an unforeseen event having occurred.||Anybody who is concerned about what would happen to their income if they were unable to run their business unexpectedly.||Following the fire at your premises, you can no longer work from your warehouse. Your policy pays for pre-tax shortfalls in your profit and any increased costs incurred running your business (such as temporary premises).|
On top of these, you may wish to consider other products to cover you personally such as; personal accident cover, sickness cover, private medical insurance, loss of licence, life insurance, income protection, mortgage protection or vehicle cover.
It’s tough out there for everyone but small businesses in particular don’t have their employers to fall back on when unexpected things happen. Take the time to review your insurance needs now and protect your business in the long run against unforeseen events that could have disastrous financial consequences for you and your family.
We use Simply Business for our policies and love how they make buying insurance fast, simple and pain free.
Disclaimer: Always seek professional advice from a qualified insurance broker. StorSafe is not qualified to give advice on insurance products and so your own additional research should be carried out prior to purchasing a policy.
Photo credit to David Hilowitz
What policies do you buy? Do you think they are worth the money? Can you recommend a good insurance broker? Let us know in the comments below.