The primary purpose of business insurance is to protect your company from the fall-out of unexpected accidents or other litigious problems which might befall your firm. Business insurance can provide security to your company from a range of unforeseen events – everything from legal action for defamation of character to claims for employee accidents at work.
All businesses are different and the insurance requirements for one type of company will likely be completely dissimilar to those of another. For example, a marketing agency would not need the same type of cover as a company operating in the construction industry.
Consequently, there is a huge range of insurance policies available designed specifically for different market sectors. However, this also increases the importance of seeking qualified advice from a specialist business insurance broker before you invest in a policy.
The Most Common Types Of Insurance
As mentioned, there is a vast array of specialized policies tailored to particular business sectors, however, as a general guide there are six main types of insurance you should consider, depending on your range of operations:
Property: Regardless of whether your company owns or leases premises, you will need property insurance to cover the building, signage, inventory and any special equipment against fire or theft.
Professional Liability: Liability insurance will protect your firm from actions caused by the company’s negligence. Areas of liability vary massively from business to business so you should seek the advice of a professional before taking out a policy.
Workers’ Compensation: No matter the industry your business operates in, accidents can and do happen at work. Workers’ insurance will pay for the medical costs, disability or death benefits should a colleague suffer an injury in the workplace.
Product Liability: If you manufacture any type of product for sale, you must take out product liability insurance to avoid being held accountable for any damages caused by your goods. As there are so many potential types of product liability, you should speak to an advisor to find one best-suited to your particular area.
Business Interruption: Business interruption insurance covers a company when it is unable to operate – for example due to a premises fire, theft of essential equipment or injury to key staff.
Vehicles: If your firm uses vehicles in its day to day dealings, you should take out cover to avoid liability in the event of an accident. If your staff use their own vehicles for work duties, their personal insurance will normally cover them – unless they use their vehicles for deliveries or other business services (e.g. a taxi driver). In this instance, they will need to take out Flexible Trade Insurance Policies to ensure they remain adequately covered.
The Dangers Of Not Taking Out Insurance
While nobody particularly likes paying for insurance that they might never use, if you find yourself in trouble without it, you’ll most definitely regret not having adequate cover. Insurance claims against companies can run into millions, particularly with actions involving serious injury or loss of life through an accident at work claim.
When you operate a business you automatically assume a responsibility of care for your staff and your customers. Without adequate business insurance in place, you could be held personally liable for the outcome of any accidents.