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The UK holds many
business opportunities for just about anything imaginable, from retail and
wholesale to science and technology and everything in between. Regardless
of whether you have an existing business, relocating or starting a new
business, one the most important decisions you will ever make about your
business is insurance. The topic of business insurance can be a
complicated one, questions about what type, how much coverage, what is
covered and what is required by law all have to be addressed to protect
you and your investment.
Of the many types of business insurance available in the UK, there are
three basic types that every business should have. The most common and
most expansive by far is liability or employer liability insurance, which
generally covers injuries to workers that occurred in the course of
employment. There are many specific types of liability insurance
pertaining to business including public liability, product liability and
personal indemnity just to name a few. The second of the basic three types
is property and building insurance that protects the actual structure
against fires and disasters. The last of these three is business assets
and equipment coverage which usually includes items like computers and
machinery. Of the three basic types, liability is required by law and the
other types may or may not be depending on your particular situation.
With the economy as troubled as it has been, the urge to cut costs by
carrying the bare minimum of coverage required by law can be very
tempting. When it comes to business insurance in the UK, you can't take
chances with a bare minimum, a business is far too important and valuable
to leave to chance. Just carrying employer liability insurance leaves you
exposed to a multitude of risks that can leave you and your business in
financial ruin. Everything from products in transit to faulty or damaged
goods can begin an endless trail of legal and financial pitfalls that
could be handled much easier with the proper coverage. Most of the time
things like defective products are covered by the manufacturer, but if the
company goes out of business the financial burden can fall squarely on
your shoulders. These are the situations that defective product coverage,
goods in transit coverage and personal or personal indemnity coverages are
designed for.
There are also issues like employee theft or maliciousness, that most
people would assume would be covered under an employer insurance program.
In reality however, employee theft or damages are not covered under most
policies and would require additional coverage specifically stating these
terms. In addition, there are many intricacies within the common types of
coverage that apply to your unique situation. Business to business
operations, software distribution and many other public or private
services require specific types of coverage, and may even require safety
inspections depending on your business. In the case of machinery and
industry businesses, engineering insurance and regular on site inspections
are both required by law.
There also the big question of how much coverage you need and who you can
get it through. By law, businesses in the UK have to carry a minimum of
£5m for employer liability and usually £5m for anyone other than
employees, but this can vary according the type of business. On top of
these you must consider the limits of liability or the 'actual payout' of
the cover you have. For instance, property and building coverage should
always cover the full cost of 'rebuilding' because the market value may
change. In addition, business assets can covered 'as new' or 'indemnity',
meaning they can covered for the full retail price when new, or if covered
as indemnity, the payout will be adjusted due to wear and tear. As you can
see there is quite a bit to consider, and you never want to leave anything
as important as your business at risk. Choosing the right coverage and in
the right amounts will ensure your success and the longevity of your
business.
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