Managing your own business can be risky if you don't have the right business insurance in place. This posts explores what cover you should have and why
Certain Types of Insurance Are Legal Requirements
Each business with a workforce is legally required to have Employers’ Liability Insurance, with only a few exceptions.
If an employee has an accident, or if they fall ill as a result of their work, this insurance will cover the cost of compensation to the employee as well as any legal fees that are incurred in the process.
Any employee who is injured as a result of employer negligence may seek compensation at any point, even if a business enters into a stage of liquidation.
What You Should Know About Employers’ Liability
In accordance with the law, the minimum level of insurance cover must be able to secure the value of at least £5 million.
Policies should cover every single employee, no matter the status of their employment contract. If your business also actively accepts workers on a voluntary basis, your insurer should also be informed.
Improper compliance with the law and Employers’ Liability can result in a fine of £2500 for every day that your business does not have the right kind of protection insurance. This is enforced by the office of the Health and Safety Executive.
More details can be found here.
Optional But Necessary Insurance
Whilst, unlike Employers Liability, many other kinds of insurance are not legally binding, they are essential.
Purchasing alternative varieties of insurance can significantly help to:
Strengthen and secure your business
Track, identify and cover risk
Accommodate repair and recovery
Therefore, on top of Employers’ Liability cover, your business will also want to consider the following types of protection:
Compensation & Legal Claims
As a company, not only do you have an obligation to your staff, but also to your customers.
If a customer or visitor suffers an injury as a result of negligence on your behalf, or if any of your employees or your organisation has breached the law, liability insurance can help you.
Liability insurance will cover the costs involved in compensating a claimant, as well as any legal fees that may have been accrued.
Buildings and contents are also a vital ingredient to any business.
Property and contents cover provides financial provides financial protection for when your property suffers damage from events including, but not limited to: burglary, fire and flooding.
Business Protection insurance is an option that will help protect your business against financial loss if an important figurehead dies or suddenly falls victim to a critical or terminal illness.
There are three main facets to Business Protection insurance:
Key Person - Profit Protection: policy contributions are paid directly to the business and are used to help secure a replacement member of staff as well as cover any loss of profits that may occur.
Key Person - Loan Protection: This is used to help pay back any loans your business may have.
Share - Ownership Protection: Policy proceeds are used to purchase the majority share of the business if an owner is diagnosed with a serious illness or dies.
If you would like to arrange a professional insurance review for your business, or to discuss your needs further, please feel free to get in touch today.