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Getting started in business can be exciting but can also really hard work. There are all kinds of new expenses to deal with, from the rent on your premises and business rates to dealing with the taxman and PAYE, VAT and national insurance. With so many outgoings even before you start to turn a profit, scrimping and saving on the things that don’t have an impact on your daily takings or monthly income can be tempting. But some things, like your business insurance, you can’t afford to be without.
Getting the right insurance in place, with the right level of cover will protect you against potentially huge legal expenses if you are sued by a customer, employee or even member of the public. With so many personal injury claims and so many professional services being scrutinised it makes sense to get your insurance in place as soon as you start trading. This short guide talks you through the three main kinds of insurance your business may need.
1. Public liability insurance
This insurance protects you against claims made against you by members of the public. These claims could relate to personal injury – for example someone hurts themselves by walking into a display stand in your shop, or someone trips over a cable while you are working on a client’s property, or they could relate to damage to property.
These kinds of claims are for accidents and incidents that you can’t really plan for, even though you may make every effort to follow health and safety guidance or make your property as accessible and safe as possible. Even small issues and problems can result in hefty legal bills and large demands for compensation which a small business may not be in a position to afford. Getting the right level of cover in place and the right policy could save you thousands and if you regularly come into contact with the public during the course of your business, it’s worth every penny.
2. Employer’s liability insurance
Most new businesses try and keep overheads down so may not always start out with employees. But if you do, and as soon as you take someone on, you will need employers’ liability insurance. This is another type of insurance that protects you and your business from the costs of legal action, but this time from incidents and accidents causing damage or injury to your employees. Unlike other kinds of business insurance, employers’ liability insurance is a legal requirement if you employ staff. If you don’t have it in place you can be fined up to £2,500 per day until you get your insurance.
3. Professional indemnity insurance
If you’re delivering a professional service - from photography to accountancy and every kind of service in-between – then it makes good business sense to get professional indemnity insurance. Again, this kind of insurance protects you against legal action but in this case it protects you from claims arising out of your work and the service you provide.
These claims could relate to negligence or simple mistakes or accidents – for example leaving confidential business papers on the bus, or mis-spelling a name or number in an important document that cause your client loss of earnings or other problems. Many professional services have claims made against them for the advice they have given, even if the client was happy with the service at the time. Most professional bodies make this kind of insurance an essential for membership. But even if you don’t need professional indemnity insurance for membership purposes, it can also help you win contracts and tender for pubic sector work so it’s well worth having.
To find out what kind of insurance your business needs, speak to one of our expert advisors today. We’ll get you the right insurance for your business at a price that won’t hurt your bank balance. Don’t gamble with your business, protect yourself and your hard earned income against risk and get the right insurance for your business now.