In any business, there is always a risk that something unexpected could occur, such as theft, illness, or injury. Regardless of how well-prepared you might be, sometimes things unfortunately just don’t go to plan; and owners must always do what they can to legally protect themselves and their assets. To ensure that, cover must be taken.
Insuring a business, small or large, can be a difficult and time-consuming process. If you are starting out, knowing exactly what you need can be a bit of a hassle. Insurance companies can offer a vast amount of plans to suit many businesses differing in size and services. Legal jargon such as ‘liability’, ‘litigation’, and ‘indemnity’ can easily throw you into a state of confusion.
If you’re thinking of starting a business, or already have one, here are some types of coverage you should consider when agreeing to an insurance policy for your organisation.
- Employers’ liability insurance: Employees can incur injuries and illness as a result of their responsibilities in the business. Coverage would protect a business from any fees or settlements that may come as a result of them.
- Personal liability: If a named individual is responsible for loss or damage to property that does not belong to them or the business, this policy would cover the business against any expenses incurred.
- Public Liability: Coverage against fees resulting from accidents to members of the public or damage to property due to your business’ negligence.
- Product Liability: Coverage to protect a business from fees resulting from damage to a customer (or their property) due to a fault in a product distributed or created by your business.
- Professional indemnity: If an individual is responsible for a breach intellectual property rights, e.g. copyright infringement, the owner of the intellectual property may desire compensation and a policy including this would cover any fees incurred as a result
- Motor insurance: Vehicles for business purposes must be covered, as claims made on a personal vehicle policy may be excluded
- Building and contents insurance: Protects against any damage to a building, or assets associated with a business.
Firstly, take note that it is very likely that a large business, or one with many operations, will require more extensive coverage than a smaller one. If a business is run in a building with goods and assets of value, a policy will need to include buildings and contents coverage to protect the business from theft, fire, floods, and accidental damage. A policy should also include public liability coverage, in case a client (or their property) incurs some damage as a consequence of a failure on the business’s end.
If you are the owner of a restaurant, for example, wait staff must be given training to ensure they will not injure themselves. Where staff could potentially become injured, cover will be necessary to pay for a medical or legal bill as a result of any injuries or loss of earnings in case something unfortunate happened. Employers’ liability insurance covers any injuries an employee may incur from carrying out their duties – for example, if someone injures their back from carrying heavy items or burning themselves after handling plates that were very hot without appropriate protection.
If like many startup businesses yours operates online, the goods and services provided could be accessed by the world. In the United Kingdom, it is a legal requirement for a business to be insured. This may vary in other countries. It, therefore, would be worthwhile to ask what exactly your jurisdiction requires, especially if you are running a multinational business.
It can be easy to be pulled in by insurance companies which claim to give you ‘the best deal’ out there. The market is saturated with different policies, and you need to get comprehensive coverage without paying for what you don’t need. Some policies may have a standard cover, with the option of add-ons. It’s worth balancing whether it is better to have a cheaper basic policy or comprehensive coverage which is more expensive.
With a large pool of expertise and experience, Linkilaw can provide you and your business with lawyers that will suit your needs. Taking a unique and transparent approach to each of our clients, we can provide advice that will make the experience of protecting your business quick and straightforward. If this interests you, feel free to contact us on our website where we will get back to you swiftly with free quotes.