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Insurance Considerations for New Businesses


Depending on your particular business and circumstances, you will need several types of business insurance. Certain types of customer might require you, as a supplier, to have particular insurances. An insurance broker can advise what is appropriate for you, and can package together suitable elements into one or more policies. Here is a list of possible types of insurance and an outline of the sort of claims against you or losses sustained by you that can be covered by each type: 

Employers’ liability: Compensation payments and legal costs if an employee sues you for a work-related illness or injury. It is a legal requirement if your business employs any staff.

Public liability: if someone suffers personal injury or property damage because of your business (e.g. a customer or other visitor to your business might suffer injury or damage their clothes or possessions due to tripping over a carpet or a construction works accident).

Professional indemnity: if a client loses money as a result of negligence in your advice, services or designs.

Product liability: if your product causes injury or damage to a customer or other person or their property.

Business buildings: damage to the building your business is based in, as a result of disasters such as fire or flooding. (This can cover you even if your business is based at your home.)

Business interruption: if you have to stop trading for a while and you suffer financial losses because of certain events, e.g. a disaster damaging your business buildings or equipment that cannot be quickly replaced/repaired. As to whether your policy covers Covid 19 as such an event, you should take specialist advice as to whether your policy provides suitable or indeed any cover.

IT equipment and laptops: protects against loss or damage to such equipment.

Stock: if you incur the cost of replacing damaged, destroyed or stolen stock held on your premises or in storage.

Tools and equipment: replacement or repair if there is damage, destruction, loss or theft of your work tools or equipment.

Contents of business premises: cost of damage, loss or theft to contents.

Construction project: loss due to theft of or damage to permanent or temporary contract works, as well as any materials being used.

Motor insurance: if you have a vehicle used for social and domestic purposes, but you also use it for business, your motor policy will need to include business use.

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