Insurance for Business Owners

Its main objective is to protect your business from claims made by a third-party or member of the public in the unfortunate event that they sustain injuries, or their property is damaged as a result of your business. Public liability insurance will cover compensation claims including legal costs, loss of earnings and damages awarded to the claimant should you be found negligent. Public liability insurance will protect you against both minor and major workplace incidents that could harm your business financially. 

Simply complete the form and one of our friendly expert advisors will provide you with the very best tailored cover that is built to your exact needs. If you wish to speak to the team directly, contact them via phone: 01244 207877 or email info@weinsuresmallbusiness.co.uk. 

The legal required business insurance policies vary dependent on the type of business and industry you operate in. However, there are a few individual insurance policies that are legally required when you are operating a business. Failure to comply to the law could lead to hefty fines therefore, we recommend companies should always contact specialist small business insurance brokers such as ourselves to find out which the business insurance is legally required for your specific industry and the way your business operates.

Having a tailored business insurance policy is an excellent way for a business to protect itself. Insurance cover offers compensation for a financial loss so it can be considered an investment toward the security of your business. Insurance cover can also be a lifesaver if your business does not have the have funds to cover losses, it also offers peace of mind for you so it means you can focus more on your business than the worry of potential issue that can arise out of your normal business activities.

What other types of small business insurance can be recommended?

1. Third-party insurance

This insurance is also called third-party liability insurance. It covers your business against claims made by third parties regarding injury or damage of property within your business premises.

2. Product liability cover

If you are manufacturing an item that could cause injury in case of a malfunction, then you will need product liability coverage.

3. Tax investigation insurance

It covers time and cost of dealing with HMRC investigation on the business.

4. Professional indemnity cover

For business offering professional services, this insurance protects against claims made by clients arising from professional negligence.

5. Business-specific insurances

There are policies specific to different types of business. For example, trade credit insurance protects against bad debts. Other insurance policies include motor vehicle insurance, directors insurance, and key man insurance.

What does third-party insurance mean?

Public liability insurance offers protection from the cost of claims made by members of the public in case of an injury or damage to their property because of your business. It protects the policyholder from incurring extra costs and expenses concerning accidental injury, loss or damage of property or even death. You can take out public liability insurance as a standalone policy, or you can combine it with employers liability insurance.

Is third-party insurance a legal requirement?

Third-party insurance is not compulsory. However, it is essential if your business interacts with members of the public. Some companies may not work with you unless you have this type of insurance. Consider third-party insurance if:

• Customers or clients visit your business premises.
• You organise events which members of the public are in attendance.
• You run your business from home and clients visit.

What events can lead to a third-party insurance claim?

Many events can give rise to a claim, the most common ones include:

• Slips and trip: It does not matter if you are on a building site or at your shop, trips can happen. Even if you take precautions, you cannot always prevent an accident from happening. Customers could trip over equipment and if they believe they have hurt themselves due to your negligence they may sue for compensation. In the event, they can prove their case the claim could cost a large sum of money.
• Damage to property:  If a visitor loses or damages personal property while on your premises you may need to compensate for the loss. An example is when a laptop is knocked down by your staff. Damages can also arise while you are performing your duties. For instance, if you damage a work surface while installing an appliance this may lead to a claim.
• Third-party claims are diverse, and your business may not be able to shoulder the compensation costs and expenses arising from these claims.

Public Liability, third-party insurance covers everyone you interact with in your business transactions apart from employees. These people may include clients, customers, people participating in your events, and people watching a game you organised. In case of a claim, the insurer covers the following.

a. Compensation claims

The insurer will take care of claims that arise from injuries to a third party or loss of property. Irrespective of where the incident took place.

b. Legal expenses

If a third party sues you, the claim will cover your legal fees and legal proceedings.

c. Repair costs

The claim also handles the cost of repairs to a clients’ property.

d. Medical fees

The insurer pays the cost of hospital treatment in the event of an injury or illness. The settlement is inclusive of the charge of calling an ambulance.

What is excluded from public liability insurance?

All policies differ depending on the type of the business. It is, however, safe to say that third-party insurance will not cover the following events:

• Personal accidents and injuries or accidents that affect employees.
• Damage to owners’ property or employees’ property.
• A deliberate act of damage.

General business insurance policy and employers liability insurance can provide cover in the above situations.

How much cover do you need?

The decision on the level of cover for your business is entirely up to you and depends greatly on your industry. The best judge is yourself as you understand the risks involved in your business and also the number of premiums your business can afford. The best way to calculate the cover required is to think of the worst case scenario and the claims you may need to cover, of course if you require any help don’t hesitate to contact our small business advisors and we can help with information and maybe other risk you may not have considered. As a business owner, you need to weigh the cost of the policy against the loss. However, in some circumstance you may be contractually obligated to take a particular amount of cover by a client.

Insurance cover can start from £1 million and may go up to £10 million. The cost depends on the nature and size of the business. The more the risk, the more you pay. We offer complete business insurance policies including multiple insurance types such as third-party together with employers liability and professional indemnity.

All businesses have a legal obligation to provide safety to their employees at work premises. Employees’ injuries and illness as a result of negligence may require compensation. Business owners are responsible for their negligence and that of their employees. Compensation can be financial for expenses incurred in loss of present and future earnings, and pain. Even if the injury or illness was due to the employee’s negligence, the employer is still liable under common liability clause.

All businesses have a legal obligation to provide safety to their employees at work premises. Employees’ injuries and illness as a result of negligence will require compensation. Business owners are responsible for their negligence and that of their employees. Compensation can be financial for expenses incurred in loss of present and future earnings, and pain. Even if the injury or illness was due to the employee’s negligence, the employer is still liable under common liability clause.

What is an Employer’s Liability insurance?

It is a business insurance cover that protects your business against financial loss as a result of injuries or illness of employees in the course of their employment. The insurance policy ensures that employers can meet the cost of settling such claims. The law requires the employers to have employer’s liability insurance for people in their employment.

Who is an employee?

There are no rules regarding who an employee is for employers’ liability insurance. The nature of your contract with them will determine whether you need to take insurance. Employer’s liability insurance is mandatory if, as their employer:

• You deduct from their national salary insurance and income tax.
• You assign duties and give instructions on the work procedure.
• You provide equipment and materials for the job. You enjoy profits the workers make; you will also be responsible for the losses.
• You expect the person in your employment to deliver the service and they won’t get a substitute if they cannot perform their job.

You may not be required to provide liability insurance as their boss if:

• They work as an independent contractor.
• They use their equipment and material to complete a task.
• They are in business to make their profits.
• If they are unable to do the job, they can hire a substitute.
• You make no deductions from their pay.

Who can sell me the employer’s liability insurance?

Take out your policy with an authorised insurer to avoid breaking the law. An unauthorised insurer may give you problems during compensation. Authorised insurers work under the terms of Financial Services and Markets Act 2000.

What should you consider when purchasing employers’ liability insurance?

• Consider the risks- if an accident causes injury to your staff you may be liable for damages which could be worth many thousands of pounds. Apart from employees’ welfare consider the effect a claim could have on your business.
• Ensure all the requirements of your company are present in the employers’ liability cover. Read the terms and conditions thoroughly.
• When seeking advice from an insurance expert be honest and reveal all your business risks to get a comprehensive cover.

If you have a business that offers professional services to your clients, it is highly recommended to take out a professional indemnity cover.  Professional indemnity cover is designed to help protect yourself from claims made by clients.

What is professional indemnity cover?

Professional liability insurance protects you from claims made by clients not satisfied with your services. The insurance covers legal expenses and costs and compensation awarded to the client. A client may demand payment if they believe that professional advice led to a financial loss or reputational damage. It is not a legal requirement, but it is a sensible cover to take if you provide professional services. This policy can save you lots of money and time spent defending a claim.

Why do you need professional indemnity cover?

Professional indemnity insurance is a popular small business insurance cover for firms that handle professional services. Here are some reasons for needing indemnity cover.

• You are a consultant. In case of a mistake resulting from following your advice, a client may claim compensation.
• Provision of expert services if you make an error in the designs, plans or calculation the client may sue.
• You handle sensitive information. Accidental disclosure or violation of the client’s legal rights might result in a lawsuit and compensation if the information disclosed ruined their reputation.
• Contract requirement. Some clients insist on the professional indemnity cover before they can hire your services.
• A requirement by your professional body. Most professionals belong to a professional body that regulates how they carry out their business operations. Some professional bodies insist on professional liability cover.

What type of work does professional liability cover?

You may require professional insurance if your business deals with:

1. Consultation and training services
2. Software development
3. Planning and design services
4. Legal and accounting services
5. Amongst other professions

Please contact us for further details.

What does a professional indemnity insurance cover?

Professional indemnity insurance provides cover for a wide range of scenarios, for example:

1. Breach of professional duty

Failure to adhere to the duty of care toward clients like giving incorrect advice or errors in your work can result in a claim. The policy also covers Employees’ dishonesty and malicious acts. It includes theft and disclosure of private information concerning a client.

2. Loss or damage to documents

It includes documents lost in the post or stolen from the business premises. It also covers expenses incurred in recovering those documents.

3. Libel or slander

Losses caused by something you say or write about the client that tarnishes the client’s public image.

4. Violation of property rights

It includes an imitation or passing off another persons’ product as your own unintentionally. It covers infringement of intellectual property rights, copyrights, and trademarks.

How much cover do I need?

The amount of cover you require will depend on many factors, for example:

• The value of contracts and projects you handle.
• Size of clients. When working for a prominent client take a more extensive cover because in case of a claim they are likely to demand a hefty compensation.
• The local authority may put in place a prerequisite level of cover to be allowed to work on a project.
• In case of a legal suit, how much compensation would the clients claim and how much money you will spend to defend yourself?
• In case of a claim will your business incur the cost and remain operational.

Most insurers have a wide range of policies, and they will allow you to select a cover that is suitable for you. The cheapest cover goes for£50000 while larger firms can take larger policies of up to £10 million

What is ‘Any one claim’ and ‘aggregate policy’?

‘Any one claim’ and ‘aggregate’ refer to a basis of cover on PI policy. An ‘Any one claim’ offers cover for each claim while ‘aggregate policy’ offers cover for all claims made in the period of insurance. Any one claim provides a more comprehensive option.