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How to Choose a Small Business Insurance Policy

By Dean Laming on June 22nd, 2022

Whatever your type of business, getting the right insurance is important.  This means that choosing the small business insurance policy that’s right for you is an important decision. If things go wrong it is important to know your business insurance policy has got you covered.

Not all business insurance is compulsory. But it is important to be covered for likely risks for your own security and peace of mind. Many insurers offer small business packages that cover all aspects of your business including small business car insurance, tool insurance, employers insurance, public liability insurance as well as any other type of insurance you need that relates to your business.

Public Liability Insurance for small businesses explained.

Public liability insurance protects you from the risk of compensation costs and legal bills should a third party bring you to court after an accident or damage to their property.   Without this, you could find that even a minor incident could leave your business with a massive bill for legal and compensation costs.

Small business public liability insurance

If your business brings you in contact with members of the public, you need public liability insurance for your own protection as well as theirs. Most restaurants, trades people, builders and beauty professionals such as salon owners and mobile hairdressers take out public liability insurance to protect them from compensation claims. Although this is not a legal requirement, it is something you should have in place as accidents can happen and often do.

Small business employees’ liability insurance

If you employ staff, employees’ liability insurance is a legal requirement. This insurance covers your business, if staff members claim to have suffered ill health or injury in the course of their work. Employer’s liability insurance protects you from any legal or compensation costs that may accrue from having a claim against you. Employee’s liability insurance is compulsory if you employ staff. You can be fined £2500 per day for every day you are uninsured and although there are legal loopholes, such as if you employ family members you may be exempt, it is important to understand the rules before you carry out your business.

Product Liability Insurance for small businesses

Product liability insurance protects you if a customer suffers injury or damage by using a product you provided, rented out or sold. It is important to remember that without product liability insurance you will be liable for damages even if you didn’t manufacture the product yourself.

These types of claim can be problematic for business owners. In some cases the product may be faulty. In other cases the customers may have misused it and it comes down to their word against yours. Either way; legal costs and compensation will be time consuming and expensive so it makes sense to have this cover in place as protection.

Professional Indemnity Insurance

This type of insurance is extremely important if your business offers advice, provides professional services to other businesses, such as accountancy or book keeping. It also covers you if your client’s information or data is compromised such as by hacking.

Professional Indemnity insurance is required by many professional organisations such as architects, accountants and surveyors so if you offer a professional service, you will need to ensure you have the correct professional indemnity insurance to cover you should things go wrong.

Do different trades require different insurance?

Different trades pose different risks. A plumber for example will have different risks to that of a bar owner or architect so it is important to get the right cover for your particular situation.

Office Insurance

Office insurance covers everything from break ins and fire damage to legal claims filed against you by staff members or customers. And if your productivity is paused for any good reason, it covers you against financial losses if your office premises are damaged and cannot be used. This type of insurance also covers your office equipment.

Shop Insurance

A commercial property that you rent out or own comes with a unique set of risks that other insurance policies may not cover. Shop insurance protects your stock, equipment and contents and even protects you against any legal expenses should you suffer a compensation claim against you. Shop insurance also protects you if your business is interrupted.

Property owners insurance

Property owners insurance protects your investments and keeps your tenants safe. This type of insurance is suitable whether you have just one property or portfolio of rental properties and will cover you for all third party damage as well as disasters such as flooding, fire damage and even damage caused by your own tenants.

Pub insurance

If you are a pub landlord you have a million issues to deal with plus a set of unique risks that could ruin your business. These include safety to staff and customers, damage to property and the protection of stock, furnishings and equipment. Pub insurance is specifically designed for the hospitality industry and protects you from any scenario where things can go wrong.

Tradesman insurance

Most trades have the potential for causing serious injury which is why customers tend to call in the professionals. If you are a professional tradesperson you know the risks of your trade and are fully aware that accidents can happen, regardless of your experience or safety record.

Tradesman insurance offers you full protection from damage and injury. It protects your tools and equipment from theft or damage and it helps you manage compensation claims and legal costs if you are sued by an angry customer.

Surgery insurance

Surgery insurance protects you from any potential risk comes from your medical business. So whether you are a dentist, a vet or private doctor, you need to be sure that you are covered for medical damage as well as for all your equipment and supplies. It also provides public liability insurance to protect your customers from any accidental damage that may occur on your premises.

Restaurant Insurance

Whether you are the owner of an upmarket cordon bleu restaurant or you run a fast food takeaway, restaurant insurance is a must. This insurance protects you from any accidents or emergencies that may occur; including cover for your equipment, stock and loss of business should your productivity be interrupted. It also protects you from common issues such as losing your licence and being sued for food poisoning or similar.

How Much Should A Small Business Insurance Policy Cost?

The cost of small business insurance will largely depend on the level of cover you require and what is included in your policy.

Public liability insurance alone for small businesses for example can range from between £50 to £500 a year. Employees’ liability insurance costs in the region of £60 – £210 per employee depending on the inherent risks of their job.

In conclusion

Your business cannot afford to neglect insurance. To keep costs down the best option is to choose from one of the small business insurance packages available to all industries and trades across the UK. Because the policies are tailored to your particular industry you can be confident that your business is protected from likely risk factors as well as those untoward events that can happen without warning to anyone.

Dean Laming

Dean is a Chartered Insurance Broker with more than 25 years insurance experience. Through various underwriting, operational and management roles, Dean has built up extensive knowledge of how to run a business and is now Managing Director of Brisco Business, part of the wider Henry Seymour Group.

All articles by Dean Laming

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