Topic overview

Business insurance needs

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Different businesses have different insurance needs. You want to make sure that you insure your business against important risks that could cause serious problems.

What business insurance do I need?

You may be legally obliged to have some business insurances. If you have employees, you need employers' liability insurance, providing cover if an employee suffers harm from working for you. If your business has any vehicles, they must at least be covered by third party insurance.

You'll probably want to insure any major assets that your business has: for example, your premises and their contents, including any valuable equipment. You may also want to insure your business against the risk that you, or another key member of the team, is unable to work because of illness or injury.

You may want to protect your business against possible claims for harm. For example, you might face a claim if a member of the public is injured on your premises. Risks can also include harm caused by defective products or if you give negligent professional advice.

You may also have particular needs related to what your business does. For example, a retailer might want to insure cash held on the premises and while it's on its way to the bank. If you deliver to your customers, you may want to insure your products while in transit.

Auditing your business insurance needs

A systematic insurance audit can help you identify your insurance needs and make sure that you have adequate insurance. As part of this, you may want to prepare an asset register, recording the key assets you have and their values. You may also want to use your accounting records to help assess possible consequential losses - for example, if you were unable to trade for weeks or months after a flood at your premises.

You may want to buy several different types of business insurance to cover your various needs. Smaller businesses often find it convenient to buy a package that combines several types of cover, but it's important to check that this meets all your insurance needs.

Bear in mind that ordinary domestic insurances often don't cover business activities. If you or your employees use your own vehicles for work, you must check their insurance policies allow this. Similarly, using your home for business may invalidate your home insurance policy.

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