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Not thinking about business insurance can, of course, be a very costly oversight if something goes wrong. But it can be difficult to know what exactly you need, and how to get the right cover without getting ripped off.

Luckily, we’ve put together a straightforward guide to help you make the right decisions when it comes to insurance for contractors and small businesses.


Do I really need business insurance at all?
Under UK law, employers liability cover is mandatory for any business that employs staff. Outside of that, there is no legal requirement for business insurance.

That said, certain professions will require mandatory cover if their regulator specifies it. For example, solicitors and accountants are required by their regulating bodies to have professional indemnity insurance in order to operate.

But even if you are not legally required to have business insurance, can you really afford to go without it? What would happen if your equipment was stolen, or if a customer fell in your premises and sought compensation? Could you afford legal support if an unhappy client blames you for lost profits?

Unless you have very deep pockets and the time to deal with these kinds of setbacks, it is advisable to explore the options with regards to business insurance.


What kind of insurance do I need for my business?
As you’d expect, there is a vast range of insurance products available for businesses. To simplify things, let’s look at the three most common types of business insurance:

Public Liability Insurance
This is perhaps the most common insurance taken out by business owners, and with good reason. Public liability insurance will cover you if someone injures themselves while on your business premises and makes a claim against you.

Similarly, if you are visiting someone on a business matter and you damage their property while there, public liability insurance will help you cover the cost.

So, say for example you’re visiting a client’s office and you accidentally break the coffee machine, or a customer visits your office and trips over a carpet – your public liability cover is going to be there to save the day.

Professional Indemnity Insurance
This is the insurance that essentially covers the work that you do. So, if your customers pay you for advice or a service, they could sue you if your advice or service lost them money or if you made a mistake.

As you can imagine, the legal costs and potential compensation payments involved in cases like this could be huge. It’s these kinds of things that professional indemnity insurance protects against.

Employer’s Liability Insurance
As we’ve already mentioned, employer’s liability insurance is the only type of business insurance required by law. If you’ve got one employee or more and you don’t have at least £5 million employer’s liability cover, your business is acting illegally.

This insurance will help to make sure anyone working for you is looked after if they are injured while under your employment. It’ll help to protect your business in these cases, too.


Who are the best business insurance providers?
So you’ve decided that business insurance is right for you, but how do you know which provider to choose? Well, our very own supplier directory  is a good place to start. We recommend Hiscox Insurance as our business insurance provider of choice.

There are, of course, some other great small business insurance providers, too. Names such as Simply Business, AXA, and Direct Line all get regular positive reviews from customers. The best option is to shop around and find the right deal for your particular needs.

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