What Types of Business Insurance Do Start Ups Need?
There can be a lot happening when you first start your own business, whether as a sole trader or as a company. It can be easy to think that insurance is something you only need when you grow but depending on what you do, there are some types of business insurance that are required from the beginning. There are also others that are worth considering in the early days to help out when your business thrives.
If you have any employees, then Employer’s Liability insurance is the only legally compulsory insurance that you need. You can receive a huge fine in the region of £2500 per day if you don’t have this cover and it needs to cover you for up to at least £5 million. There are a few exceptions, such as if you employ immediate family members but if in doubt, you should definitely get it.
These policies are designed to cover you if your employees are injured during their work. An example could be a waitress slipping on a wet floor in a restaurant or a construction worker who ends up with a repetitive strain injury due to a repeat task they do in their job.
Professional Indemnity Insurance
While not compulsory, it is worth considering professional indemnity insurance for a number of business types. The idea of the policy is that it covers you if a client thinks you have made a mistake in your work – it can include things like infringing copyright, breaching confidentiality or giving a customer advice that ended up being incorrect and costing them money. So any business that offer a professional service such as a consultant, web designer or graphic designer may want to consider it. Other industries professional bodies insist members have it, such as accountancy firms or those involved with healthcare.
Obviously, if you have a business premises that you own or rent then you will need insurance for it. Buildings insurance is often compulsory if you are buying the business property on a mortgage and many landlords will require content insurance in case something goes wrong and damage is caused to the property by your belongings. If you work from home, you may need to check your home insurance to be certain that your activities don’t invalidate your policy – for example, many policies stipulate that you can only do clerical work from home under a standard policy.
Again, depending on your job, you may want to consider public liability. This is a policy that covers you for any injury caused to the public or any damage to their property and is common for people who work in industries such as builders, window cleaners and gardeners. If, for example, your ladders fell over and smashed a customer’s car windscreen, then you would use the public liability insurance to pay for the damage. You can also get product liability that covers if any of your product cause damage or injury to the public so if a toy was to cause an injury to a child.