There are many things to consider as a business owner, above and beyond your day to day work.
One admin task that may work its way to the bottom of your to-do list, or one that can seem painfully complicated, is purchasing business insurance.
In this guide, we’ll help you understand whether your business needs insurance and how insurance can help you manage business risks.
Do you need business insurance?
All businesses will face some level of risk, and insurance is designed to help you manage those risks. If you’re wondering whether your business needs insurance there are three main points to consider.
- Your exposure to the cost of a claim—Whether it’s a claim against you, or a claim you need to make, the cost of any such claim will likely far outweigh the amount you would spend on purchasing your insurance. If you are entirely reliant on your own income, having business insurance in place could actually save you money in the long run.
- Your legal responsibilities—The only insurance that is mandatory in the UK is employers liability insurance. If you employ any staff, you’ll need to take out this cover. You could be fined if you don’t have it in place.
- Your obligations to others—You may find that clients, investors, associations or even workspace providers require you to have adequate insurance to enter into a relationship, so having insurance could open up more opportunities for your business.
For example, as part of WeWork’s standard private office membership agreement, members are required to have public liability and contents cover in place. And depending on the type of agreement and location, there may be contractual requirements to obtain certain insurance policies.
What insurance might you need?
The insurance you need is largely dictated by the type of work you do, however there are some covers that are suitable for almost all businesses.
If you work around people—clients, customers, couriers, you name it—then this cover is for you. Not only is it one of the most popular covers for businesses, but it’s also a requirement of WeWork’s standard private office membership agreement.
Public liability covers legal and compensation costs if a member of the public is injured, or has their property damaged, due to your business’s negligence.
So, for instance, if someone was walking past your desk and tripped on your computer wire, hurting their wrist and ankle, public liability insurance would cover the legal and compensation costs if they made a claim against you.
Employers liability cover (EL) is a legal requirement for any business in the UK that has employees, regardless of whether they’re full time, part time, temporary or contracting as outlined in the Employers’ Liability (Compulsory Insurance) Act 1969. The cover works much like public liability, however instead of a member of the public EL covers legal and compensation costs if a member of your staff is injured, or has their property damaged in the course of working for your business.
EL claims could include improper training leading to an injury, mental health issues after suffering extreme stress at work or damaging property after not being given protective clothing.
Whether you’re working remotely or from an office, if you have employees you’ll need this cover in place. If you don’t you could be fined up to £2,500 for every day that you didn’t have the cover in place by the Health and Safety Executive (HSE), who uphold the law. As stated in their guidelines, if you do not display the certificate of insurance or refuse to make it available to HSE inspectors when they ask, you can also be fined up to £1,000.
Business contents insurance
Business contents cover protects against damage, loss or theft of the physical equipment you use to run your business. This includes equipment such as phones, laptops and tools. If you rely on portable tech or equipment to do your job and something gets misplaced or damaged, this cover can help you to replace the item through reimbursement or replacement as quickly as possible, so you can get on with your job.
Business contents insurance is a requirement of WeWork’s standard private office membership agreement.
Professional indemnity is particularly important if you work contractually, and it provides legal and compensation cover for the professional services you provide. This includes if your business offers advice and consultancy, providing protection against claims such as libel, copyright/ trademark infringement, design flaws, incorrect advice, defamation and plagiarism.
Some common roles that could find professional indemnity particularly useful are designers, consultants, accountants, healthcare professionals and architects—essentially, anyone who works with clients or provides a service that could result in loss of finances.
For instance, let’s say you’re a surveyor who produced a flawed report for a property developer. You’re then sued for the costs of rectifying the architectural drawings and the delay in construction. Professional indemnity would cover the legal fees and compensation for the financial loss that the property developer suffered.
An increasingly essential yet frequently overlooked cover, cyber liability is designed to cover risks that come with storing and handling data. This includes accidental privacy breaches, digital IP infringement, hacking, cybercrime and business interruption as a result of a cyber security breach affecting your systems or those of your suppliers.
You might not think hackers target SMEs, but last year 38% of small businesses suffered a cyber breach or attack, with the average cost of an attack over £8k, so cyber cover is worth considering.
An example of a cyber claim would be if a business’ website crashes due to a cyber attack on the web service firm that hosts the site. A cyber policy could pay out for all projected profits lost during the company’s downtime, even though the outage happened on a third-party site.
Or one of your employees accidentally opens a malicious email and downloads ransomware onto your company’s system, locking your files. A cyber policy could cover the ransom demand to unlock your system as well as the profits lost due to business interruption.
What do you need to do to get covered?
Choose an insurer
As with any purchase, doing a bit of research is a good idea. When comparing insurers, it’s worthwhile having a look at the features that are unique to them and assessing whether these work for your business. These could include price, payment terms, level of cover, customer service availability and claims process.
Some questions you can ask here include:
- Does the insurer offer monthly or annual subscription?
- Do they offer the level of cover I need to run my business?
- Are they available by phone, email or direct message?
- How quickly will they get back to me when I make a claim?
Provide accurate information about your business
When you’re ready to purchase, you can often get set up online in a matter of minutes. You’ll typically need some information about your business to hand, including the type of the work you do, where you work and how much money you expect to make in the next 12 months.
Providing accurate information will ensure your cover is fit for purpose should you need to make a claim, and will reduce the chance of you purchasing cover you don’t require, so you only pay for what you need.
Update your policy regularly
As your business changes it’s important to make sure your cover remains appropriate. A significant increase in turnover, a launch of a new product or market or an increase in staff on the books are all prompts for reviewing your policy.
WeWork has partnered with Superscript to offer WeWork members based in the UK access to flexible business insurance.
Wave goodbye to restrictive, old-fashioned annual contracts and frustrating additional and hidden fees. Superscript offers subscription-based insurance that you’re free to cancel at any time.
Superscript is offering WeWork members access to insurance coverage designed to make meeting the requirements of your WeWork membership agreement as easy and affordable as possible, with the first 2 months’ cover for FREE. Learn more.
If you’re looking for additional cover beyond public liability and business contents cover, Superscript provides cover for businesses in over 1,000 industries including professional indemnity, product liability, employers liability, cyber insurance, directors and officers and many more.
Superscript is a trading name of Enro Limited, registered in England and Wales 9265254. They’re authorised and regulated by the Financial Conduct Authority 656459.
Please note that this offer is made available exclusively by Superscript and WeWork is not responsible for the redemption of or the performance of the offer and does not make any representations about the offer whatsoever. If you have any disputes or issues regarding the offer, the redemption of the offer or the services obtained by Superscript, you must contact Superscript directly.
You acknowledge and agree that WeWork is not responsible for the performance of third-party employees or agents or for any third-party products or services offered by Superscript. Superscript may provide goods or services that require Superscript to have a regulatory authorization or license. WeWork does not verify, validate, or collect evidence of regulatory information about Superscript. You should make whatever investigation you deem necessary before redeeming any offering from Superscript. Superscript is solely responsible for the accuracy, care and quality of the services being provided and the offer. Please contact Superscript directly with any issues or concerns. Any advice received is based upon the opinions of Superscript and their agents and is not necessarily the views of WeWork or its employees. WeWork assumes no responsibility or liability for any errors or omissions in the advice or services.