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It’s easy to overlook sorting out your insurance cover when starting up a brand new business. Ideally though, you shouldn’t really be stepping one (metaphorical) foot into the marketplace until you’re adequately protected.

Arranging insurance cover for your new start-up venture isn’t as simple as ticking from a selection of boxes though. There are a whole host to choose from for businesses of all shapes, sizes and natures. Some insurance companies will even offer tailored plans which are personalised just for you and your needs.

That said, we’ve made a list of the most common types of business insurance as a starting point for you to work from. We also have a guide to help new businesses get started.

 

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Public liability insurance

This type of cover is essential if your business operation means you will be visiting customers out in public, or if they will be coming to your premises.

It’s designed to make sure that you have protection in case of claims made due to damage or injury whilst in contact with the general public. For instance, if somebody was to slip and injure themselves on a wet floor in your office or business premises.

Product liability insurance

If you manufacture products for use by the general public, you will need product liability insurance. No matter how meticulous you are about ensuring your goods are safe and compliant, it makes sense to be insurance in place. That way, you have protection in case of damage claims as a result of using your products.

Professional indemnity insurance

This type of insurance is there to protect your business in case of any claims against you regarding negligence, mistakes or failure to perform or deliver.

It will be specific to the nature of your business as different sectors will carry different kinds of risks around errors & omissions (E&O).
 

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Employers’ liability insurance

As a start-up, this may very well not be applicable to you just yet. But when your business employs somebody, you’re going to need to arrange employers’ liability insurance cover. In fact, it’s a legal obligation to do so.

You will need at least £5 million of cover or else you could be facing fines of up to £2,500 for every single day you aren’t protected. It’s worth noting though that you aren’t legally required to have this cover if you are employing immediate family members.

Learn more about what to do when you employ someone for the first time.

Stock insurance

This type of policy will help cover the cost of any stock you might lose due to theft or damage. Of course, the cost of this type of insurance protection will vary depending on the value of stock you’re looking to cover.

Other types of essential insurance cover to consider for your start-up

Building and contents insurance  If you rent a business property, you will only need to arrange contents insurance for what’s inside it. If you own the premises, you will need to ensure you have business and contents cover both sorted.
Business interruption insurance This protects you if you suffer loss of earnings or business disruption due to a disaster out of your control. The COVID-19 crisis is a perfect example of where this non-obligatory cover would be invaluable.
Vehicle insurance This will only apply if you or any employees use a company vehicle for business purposes. One worth keeping in mind for the future.
Trades insurance Whether you’re a builder, an electrician or a painter (amongst others), various trades have various different types of insurance recommendations. It is worth seeking advice on the granular details around these if your business falls under the trade category.

If you would like more information about how our online accounting services support start up businesses, you can talk to one of the team. Call 020 3355 4047, request a call back, or get an instant quote online.

About The Author

Stephanie Whalley

Serial snacker, compulsive cocktail sipper and full time wordsmith with a penchant for alliteration, all things marketing and pineapple on pizza.

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