How Much Does Business Insurance Cost?

How Much Does Business Insurance Cost?

Any company, whether it is a large international firm or a small independent contracting business, needs to be fully and appropriately insured. The risk of things going wrong, and the potential costs involved if they do, is just too great to make avoiding getting insurance a realistic option. But how much does business insurance cost? Here is an introductory guide to some of the main varieties of business insurance, including public liability and employer’s liability insurance, outlining rough estimates of costs and coverage.

Public liability insurance

What is public liability insurance?
This is the kind of insurance that protects your business against claims for compensation from members of the public who have either suffered an injury or had property damaged as a result of your company’s actions in some way. This could be someone visiting your place of business and having an accident such as tripping on a step or banging their head. It might also be something more serious like a car accident in which one of your company’s vehicles was involved or an incident on a building site in which a member of the public or their property has suffered in some way.

Who needs public liability insurance?
If your business has any interaction whatsoever with members of the public then it is strongly advised that you consider getting public liability insurance. Any retail operation that has customers entering the premises, i.e. a shop as opposed to a mail order operation, or any company that does work outdoors in the vicinity of public places and property will need to have this kind of insurance. Likewise, if your company or any members of staff make visits to people’s homes then it is important to be fully covered.

How much does public liability insurance cost?
The amount you end of spending on public liability insurance will depend on the type of business and the attendant risks involved in its operations. A construction company has to pay much higher premiums than a comparatively ‘safe’ business such as an internet based firm that rarely, if ever, receives visits to its premises. The price range is therefore incredibly broad, but at the lower end of the scale, a ‘safe’ business can expect to spend less than £100 per year for up to £1 million in public liability coverage.

Employer’s liability insurance

What is employer’s liability insurance?
This is the type of insurance that covers your company against claims from any members of staff who have been injured or become ill as a result of working for your company.  

Who needs employer’s liability insurance?
This type of insurance is mandatory for any company that has employees. If you have people working for you, even if it is only in a part time capacity, you will be breaking the law if you are not fully insured in this respect.

How much does business insurance cost?
According to the Health and Safety Executive, if your business has employees, you must have employer’s liability coverage of at least £5 million. In actual fact, most insurance companies will offer packages that cover of up to and over £10 million, so it is worthwhile finding out exactly how much you need to be covered by; this will depend very much on the type of business you operate and the potential danger of the work you are asking employees to undertake. Unfortunately there is no standard fixed business insurance cost. The best way to find out what you’ll be paying is to quotes from multiple providers. A service like ours can save you a bunch of time a find up to 4 free quotes this week.

Other types of business insurance

Public and employer’s liability insurance are not the only types of insurance that a business needs to think about. Depending on the type of company and the nature of its business, it may be necessary to get one of these types of business insurance.

Professional indemnity

This type of insurance protects consultants and freelancers, or anyone who works in an advisory capacity, against claims related to problems that have arisen as a result of their services. If a client loses money as a result of something that they claim is the fault of the consultant or freelancer, then they may sue. In which case professional indemnity is there to cover legal fees and damages that may need to be paid as a result.

Property insurance

This will cover your place of business and your company’s assets. By providing coverage for both the premises in the event of a flood, fire, theft or natural disaster, property insurance is an essential requirement for any business with its own premises and assets.

Essential business insurance advice

With all types of insurance, it is important to get a few quotes before deciding on a package that you feel is right for your business. The golden rule is to make sure that the compensation on offer from the insurance company will definitely cover any of the costs that you may incur if anything should ever go wrong.