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Business Insurance Basics

For informational purposes only. Please discuss business insurance with your insurance broker, solicitor or other qualified adviser. Any of whom should be FSA registered.

Why do you need insurance?
Potential threats to your business can and do occur every day. Whether it be a small dent in a van to a major issue that could stop you trading, insurance is needed to be fully protected. More serious threats from vandalism, robbery or a fire can occur at any time. Injury to staff members of suppliers on your premises can be serious matters. Professional advice needs to be sought to ensure the business is fully covered in all instances.

Some insurance is optional and some are legally required. That depends on the industry you work in, where the business operates from, and whether staff are employed.

These are some of the main insurances to be considered:

Insurance to Protect the Business

Equipment And Office Contents Insurance
Whether working from home or on a business premises your workplace will need to be insured. This includes fixtures and fittings and general office equipment. Include and specialist tools, machinery or portable equipment needed to run your business (e.g. laptops). Always remember to add new equipment to the policy. These will need to protected against loss or damage by fire flood, vandalism or other major risks.

Car or Van Insurance
Policies need to cover you for the type of journey you are making. Many policies don't include coverage where you are transporting goods or travelling to customer premises. Be clear with insurers as to what traveling uses will be and get adequate cover.

Goods in Transit Insurance
Not only do the transport vehicles need to be insured, but the goods being transported need to be covered while in transportation.

Business Interruption Insurance
This is cover for loss of revenue or trading profit if your premises is unable to trade due to damage to property or equipment.

Money Insurance
Reimburses for lost or stolen money from the business, at home or while in transit.

Insurance to Cover Liabilities
There is a duty of care to all customers, suppliers, employees, and general public. You can be held legally liable if anyone is injured on your premises as a result of negligence or breach of duty.

Product Liability
A product is any physical item sold or given away. Even if you did not manufacture the product, if you supplied it from your business you can be held liable for any damage or injury it may cause. Insurance generally covers you for unforeseen circumstances rather than for inferior products not fit for purpose.

Professional Indemnity Insurance
Used for people who sell their skills or expertise. This can protect the business from clients seeking compensation for damages caused by taking your advice. As there can be some time lapse before providing the service and receiving the claim be sure to have coverage at the time the claim arises. This can mean staying insured even if you no longer provide the service any longer.

Employers Liability Insurance
Companies have a legal responsibility over people in their employ to see they have adequate liability insurance. Significant fines can come into play if you do not. This insurance protects employees for any injury or illness they may have while working for you. Since 2005, this insurance is no longer required if you are your company's only employee.

Public Liability
Coverage if members of the public visit your premises, including working from home. If any injury or damage occurs during the normal operating business hours, this insurance will protect you.

Business and Liability Insurance Providers

Decision Finance

Swinton business insurance

Norwich Union business insurance

As a business owner also consider:

Income protection insurance--pays a regular income if you are unable to work because of illness or injury.

Private medical insurance--covers the cost of private medical care for you and key members of your staff.

Private medical insurance providers:

BUPA International

Norwich Union healthcare

Important Footnotes

Conditions and exclusions
Understand what has been purchased and be aware of any conditions or exclusions that are attached to the policy. Finding out you aren't covered because of small print, after the fact, is not the preferred option.

Are You Covered In Full?
It is your responsibility to see you have adequate cover. Keep all receipts for proof and supply accurate information to the insurance company. Under insurance, means you won't get the amount of claim you need. Over insurance means you are paying more than you need to.

Cheapest Is Not Always Best
Most times it can be after you need to make a claim that you discover how good or bad the insurer is. Reputable companies or those personally recommended are a good start point. Check thoroughly into how they handle claims and if 24-hour access for claims is available.

Watch Out For Policy Excesses
In the case of excess, you are responsible for paying out that amount for every claim. Be clear as to what that amount is. policy premiums can be increased or reduced according to excess amounts.
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