Business Insurance

We are often asked to advise new start-up businesses on the types of insurance policies that are available to them.

We detail below some of the most important and widely used policies that exist. This list is by no means exhaustive and you should be aware that specialist policies/ cover are available to guard against specific risks. You should always consult an insurance broker and check the terms of your policy very carefully.

1-2 below are compulsory, 3 will no doubt be a requirement by any given landlord of premises or lender and 4 and 5 will be optional:

  1. Employers Liability – once one employee is taken on you are legally required to take out Employers Liability Insurance. There is a prescribed legal minimum which the insurance company will make you aware of to cover against bodily injury, illness or disease sustained by someone in the course of employment.
  2. Public Liability – legal liability insurance to pay damages consequent upon bodily injury, illness or disease contracted by any other person, other than employees, or loss of or damage to their property caused by the insured.
  3. Property and Buildings – buildings and contents can be insured against fire, lightning, explosion of gas and boilers without the addition of special perils such as explosion, riot, malicious damage, storm, flood, impact by aircraft, road and rail vehicles, escape of water from tanks or pipes and sprinkler leakage. ‘All risks’ insurance gives wider cover including any accidental damage or loss not specifically excluded. However ‘all risks’ will not cover wear and tear, electrical or mechanical breakdown and gradual deterioration.The business premises should be insured for their full rebuilding cost (including professional fees and the cost of site clearance) and not just for their market value.
  4. Business Interruption – even minor damage to your property could seriously disrupt your business leading to loss of income and extra expenses. Business interruption insurance will compensate for the short-fall in gross profit together with paying any increased working costs and extra accountants’ fees incurred.
  5. Business assets and equipment (contents cover) – your stock should be insured for its cost price without profit. Business equipment can be insured on either a ‘replacement as new’ or an ‘indemnity’ basis. If indemnity is chosen, wear and tear will usually be taken into account when settling any claims.

Contents are usually covered against theft providing there has been forcible and violent entry to or exit from the premises. Damage to the building resulting from theft or attempted theft will also normally be covered.

You can usually get one policy that will cover all of the above.Â

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