Insurance forms a guarantee against any loss. You must weigh up the extent your business assets are exposed to risk and what effects this may have on your business in the likelihood of this happening. Insurance is an overhead, producing no benefit until a calamity occurs. It is therefore a commercial decision as to how much to carry, and it is a temptation to minimise this cover. Some cover is required either by employment law or as an obligation imposed by a mortgagor.
You will have to establish your needs by discussing your plans with an insurance broker. Make sure you know exactly what insurance you are buying. Get at least three quotations prior to commencing with just any broker.
It is recommended that you carry at least 2 million pounds in cover to meet your legal liabilities for death or bodily injury incurred by any employee during the course of business. In practice, this cover is usually unlimited, with the premiums directly related to your wage bill.
Employee's liability only covers accidents in which the employer is held legally responsible. You may feel moral responsibility to extend the cover for those carrying out any hazardous task or to cover your own financial security should you be ill.
This protects employers against legal liability in the event of death or injury to a third party on their property. This may occur as a result of defect in the premises, employees neglect or liabilities arising from the product you manufacture.
This relates to anyone giving professional advice and their liability arising from wrongful advice and negligence. Solicitors, accountants, management and computer consultants come under this category.
There are a number of ways of covering these. Reinstatement provides for the full replacement cost. Indemnity meets only the current market value less depreciation. There are other things to consider too. Removal of debris, architect's fees, employee's effects and local authorities sometime insist that any new building must meet much higher standards than the ones they replace.
Raw material to finish product, it is as exposed as any other part of your plant or equipment in the event of a fire or other hazard. Theft accounted for 50 million pounds in 1982.
During the rebuild of your new premises in the event of a fire, employees wages and overheads will need to continue during this interruption. Insurance for consequential loss is intended to restore your business's financial position to where it may have been if the interruption had not occurred.
Until the goods reach your customer, they are still at your risk and you may need to cover them against loss or damage in transit.
Although you may have adequate private use cover for your present vehicle, this is unlikely to be sufficient to cover the vehicles for business use.
In the event of threats from a third party, a fidelity guarantee can be taken out to protect you from fraud or dishonesty on the part of key employees.
