Key risks covered by business insurance policies

Business insurance is there to help give you peace of mind and protect you from losses which may arise during normal business proceedings. There are a variety of different risks that can be covered and Lockyers will work with you to identify which cover you need (and just as important what you do not require).

• Employers’ Liability

You are legally required to have Employers’ Liability insurance if you have full-time or part time employees even if they are on a short term contract. This cover will protect you and your business if an employee is injured or falls ill because of their work. The policy can cover the legal costs of defending a claim made against your business in addition to any claims for compensation that need to be paid to an employee should the business be found to be at fault.

• Public Liability

If you come into contact with members of the public during the course of day-to-day business, at your premises or theirs you will require Public Liability insurance. This policy can protect your business against claims from members of the public for injury sustained or for damage to their property arising from your negligence when conducting your business activities.

• Business Assets

If you had to replace your business assets for example, after fire or theft, the cost could be huge. This policy should be tailored to your needs and could include glass for shop fronts as well as stock.

• Professional Indemnity

A client could make a claim against your business for actual or alleged wrongful advice or design work. This policy can protect you from legal costs arising from a claim up to the policy limit but, like other liability insurance it will not cover for fines or penalties.

Do I need business insurance?

Whatever the size of your business it’s important that you are covered for the risks to which you might face exposure.

Additional considerations

The most important factor is understanding the potential risks faced by your business and the protection required from your insurance. If you run your business from home, you may still need public liability or professional indemnity insurance. Additional cover can be arranged and could include:

• Property insurance can help protect your business assets, e.g. buildings, general contents, computers, phone systems and other electronic office / testing equipment, machinery, plant and stock. The cover can be for a range of risks including fire, eater damage, explosion, impact, malicious or accidental damage and theft. You may require cover for property in transit or in other locations as well as just your premises.
• Business interruption cover is also important as it can help to pay overheads that you will still have to pay during the period of business recovery because of the insured loss or damage that has impacted on your ability to trade and reduced your income.
• Directors and officers (D & O) do not receive an indemnity from their company and if they do not have D & O insurance then they will have to pay the loss (and any defence costs) out of their own pockets. Directors are personally liable reasons to defend any claims and their personal assets are at risk. The consequences of such legal action can be devastating – disqualification as a director, criminal prosecution, personal bankruptcy, loss of your job and reputation as well as family trauma. D & O cover can help with defence costs incurred during claims and awards made against you personally.
• Cyber risk is defined by the Institute of Risk Managers as any risk of financial loss, disruption or damage to the reputation of an organisation from some sort of failure of its information technology systems. Hackers target valuable data including: financial information, intellectual property, healthcare records, employee data and general private information. Cyber liability cover can help to protect from
  • loss or damage to digital assets
  • business interruption from network down time
  • cyber exhortation where third parties threaten to damage or release data if money not paid to them
  • customer notification expenses where there is a legal or regulatory requirement to notify them of a security or privacy breach
  • reputational damage arising from a breach of data that results in loss of intellectual property or customers
  • electronic theft of money or assets
  • third party cyber insurance can also cover the assets of others, typically your customers.

Whatever the size of your business get in touch with Lockyers or call 01925 278222 to review your business insurance cover.