New business owners have a plethora of things to think about, some of which end up getting pushed down the to-do list because other, more important, matters take precedent – but when it comes to setting up a new venture, one of the major aspects that needs to be considered as soon as possible is the relevant business cover that you need to invest in.
Unfortunately, no new business is immune to compensation claims, despite the age-old belief that ‘it won’t happen to me’. If a start-up business has to face legal action, for whatever reason, and they don’t have the right insurance in place to protect them, it can be incredibly hard to recover. This is why business insurance should be at the forefront of any business plan, ensuring that all the right insurance policies are in place before you begin trading.
Public Liability Insurance
For most small businesses, this is one of the most important covers you need to consider getting. While it’s not essential for every business, if you are going to be in contact with a third party – whether it’s a customer or client, a contractor or the general public – you need to consider investment in the cover.
If an accident was to occur that resulted in injury to a customer or damage to their property due to your services, your business would be liable and you could be facing a compensation claim. This insurance will cover you against these types of incidents.
Employer’s Liability Insurance
This isn’t just recommended but is a compulsory cover if you hire others to work for you. Whether it’s full or part time staff, or just employing people on a temporary basis, employer’s liability insurance is essential. It’s a legal requirement to have at least £5m cover, which will protect your business should an employee fall ill or is injured in the course of their work.
Without it, you could automatically be fined £2,500 for every day that you don’t have the cover.
Professional Indemnity Insurance
Any self-employed business which offers advice to other businesses or individuals should consider this type of cover, which will protect them if their advice or the service they provide is deemed negligent in any way.
This type of cover will help you to cover any compensation claim that is made against you, as well as the legal costs incurred.
While these are the three main insurances that a business should consider, there are also other bespoke policies available to suit individual business needs. Make sure that your back is covered when you start up your new business – prosecution can be crippling.
This article was written in association with Hiscox, a reputable insurance company that provides advice and insurance quotes for businesses, big and small. If you’re a start-up business, you can find more information about business insurance from Hiscox on their website.