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Insurance – what does my business need?

Insurance - what does my business need?

Insurance - what does my business need?

A common mistake made by small businesses and sole-traders alike tends to be not having the right insurance cover in place. This can lead to any manner of problems for you – including legal proceedings. This is clearly something most businesses simply cannot afford to get involved in – both in terms of time and money in an economic recession.

So let’s briefly look at the types of insurance available to small businesses and sole-traders:

Covering your Assets.

Tangible (physical) assets such as office equipment, computers, photocopiers, etc all
need some form of insurance cover in-case of damage or theft. Never undervalue the overall value of your contents. You should think about the worst-case scenario (e.g. entire office gets destroyed in a fire or flood). How much would it cost you to replace everything your business owns?

Liability Cover.

Are you a Sole-trader or do you employ a workforce? Do you work around members of the public or do you have customers coming on-site? There are a number of different liability policies that cover different areas. For example, if you employ a workforce then you should take out ‘Employers Liability Cover’ which will protect you and your business should an employee wish to sue (e.g. for an accident that happened at work). Public liability insurance is another useful cover to have if you come into contact with members of the public. For example, if a member of the public is injured or their property is damaged as a result of your company’s actions then Public liability will protect your business if that person should try and sue you.

Professional Cover.

Do you offer professional services such as legal advice, accountany or marketing consultancy? Then Professional Indemnity cover is essential as it protects you and your company if you make a mistake that costs your client money. The cover can provide for legal payments and monetary compensation. It is important to consider the worst-case scenario when purchasing Professional Indemnity to ensure you are fully-covered in any eventuality. Examples of this tend to be more rife in an economic recession as struggling business clients may try to sue you in order to get out of a contract if they can prove your company has breached it. Prime examples of this include SEO marketing companies that have not delivered the services or promised influx of traffic to a client’s corporate website.

Retail Cover.

Own a shop, restraunt or pub? Then you should get some kind of Retail insurance – this includes:

  • Liability insurance – both employers and public liability as well as stock and contents,
  • Business interruption insurance (should your business stop trading due to unexpected occurences such as fire, flood or theft)
  • Shop money cover (covers you if money is stolen on your premises – this includes stamps, postal orders, gift tokens and vouchers as well)
  • Building insurance (protects your building from damages incurred as a result of fire, flood, etc).

As you can see there are numerous policies that are available to your business and it is well worth looking into if you are unsure of what policy is right for you. Please see below for a number of useful links on small business insurance.

Constructaquote

Wikipedia Article on Public Liability

Business Link for Business Insurance

Wikipedia Article on Professional Indemnity

Wikipedia Article on Sole Proprietorship


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Photo by Michal Marcol

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