Business Insurance for Start Ups
What Is Business Insurance
Risk is prevalent in just about all areas of business and like car insurance, business insurance is taken out to mitigate the risk of something going wrong. Business insurance covers the financial losses and liabilities of a business should something go wrong. It can protect a business from a variety of risks, including property damage, liability, and business interruption.
Why Insurance Matters for Start-Ups
Policies such as Employers Liability or Vehicle insurance are a legal obligation if you have an employee or a company car, whereas a Key-man or Professional Indemnity insurance policy is optional.
If there are particular risks associated with your business, such as design work, then Professional Indemnity insurance can be a great way to mitigate the effects on your business if these risks should come to fruition.
When to take out Insurance for a Start-Up
This is completely dependent on the type of insurance and your business activities. Legally obligated policies such as Employers Liability should be taken out before or as soon as you employ a member of staff.
Types of Insurance for Start-Ups
Public Liability Insurance
These policies are to cover the risk of you injuring someone or damaging their property as a result of your business activities. The policy will cover a claim and legal fees from a third party.
Employers Liability Insurance
These policies are legally obligated if you have employees or even just an employee. The policies are designed to cover a claim made by an employee who is injured at work or falls ill while working for your business.
Product Liability Insurance
If you design, manufacture or supply a product, then you can be found liable if the product causes any damage or injury. The policies will cover a claim and legal fees from a third party.
Professional Indemnity Insurance
This insurance is for businesses that provide intangible services - such as knowledge, advice or skills. The policy is to cover a claim made for loss of sales or damage to reputation as a result of the services your business has provided.
Directors and Officers Insurance
Directors and officers insurance is a form of liability insurance designed to protect the personal assets of directors and officers of a company from claims made against them while acting in their professional capacity. It covers the costs of defending against lawsuits and other claims brought against directors and officers for alleged wrongful acts in their capacity as corporate representatives. It also provides indemnification to cover any settlements or judgments that may be awarded against them.
Key-man Insurance
If you have a valuable employee - to the point where you fear what impact it would have on your business if something happened to them - then you can insure them. If the individual was then to have an accident or be unable to work, you would be able to claim against your policy.
Business Interruption Insurance
There are a lot of unknowns in life and things go wrong every day. This policy is designed to help protect your business from these unknowns. If your trading is interrupted by an unforeseen event, such as a fire, flood or even a pandemic, this policy would compensate for the loss of sales and profit to keep your business going.
Business Property Insurance
This policy is designed to cover any damage to your business's physical property. This can be damage to the premises, your office equipment, tools, stock, etc.
Credit Risk Insurance
Credit Risk Insurance is designed to remove the burden of a customer becoming insolvent away from your business and onto the insurer. You'll be able to claim on the policy if your customer becomes insolvent or fails to pay their trade debts.
Cyber Insurance
Living in the digital age has subjected businesses to a new type of threat. The policy will cover your business for risks such as data breaches, a third party hacking your system or corrupting your data.
Vehicle/Fleet Insurance
When you buy a vehicle as an individual, you're legally obligated to insure the vehicle if you wish to drive it on public roads. It is no different if you buy a vehicle through a business, you must purchase insurance.
Other Insurance Policies
There are several other insurance policies businesses can take out to mitigate the risks specific to their activities. Such as Contractors All Risk Insurance, Landlord Insurance, Tools & Equipment Insurance, Legal Expenses Insurance, etc.
Are You Ready for an Insurance Quote for your Start-Up Business?
Simply Business
Simply Business is a great option for business owners in the UK looking to get insurance quotes for their businesses. Simply Business provides comprehensive cover tailored to the specific needs of your business, with competitive rates and easy-to-understand policy documents. They offer a range of cover options, from public liability to professional indemnity, and even specialised business insurance such as cyber liability or business interruption. They also have a helpful customer service team who can provide expert advice and answer any questions you may have.
Thinking about starting a business, but not sure where to start... Get in touch today for a no-obligation chat.