As a business owner you may find yourself asking the question “What business insurance do I legally need”? Well there are some insurance risks which must be covered by law and others which it really is a good idea to have. The main legal requirement as an employer is employer’s liability. This is essential and there are quite severe penalties for employers who flout this law. If you have just one employee who is not an immediate family member, you must have employer’s liability insurance. It is a good idea when your business is at the point of taking on staff to talk to a local insurance broker who will be able to chat to you and guide you through the rules and regulations.

Some insurers provide cover for ‘up to’ a certain number of employees and this is a good way to go as it will cover you in the event of your needing staff in a hurry. You don’t need to specify the staff by name; you are insuring your own liability, not individuals you employ. The amounts you need cover for is varied from time to time by law, but your broker will arrange the right cover for you, so you don’t need to worry about the details. Depending on what your business is, you may want to increase the amount.

If you have vehicles, they must also be adequately insured. Most businesses choose third party and this is adequate, but a policy covering any driver is probably better. A group insurance is usually the cheaper option and using a local insurance broker will again be beneficial as you can talk over your requirements in person. There are other insurances you can take out which are not legal requirements but are nevertheless a good idea. These include property and buildings, of course, which will probably be a requirement of any lender, but also less obvious additions, such as key man cover and goods in transit. This kind of optional insurance can come in the higher end of the premiums paid by businesses, but your local insurance broker can advise you on aspects such as how expensive it is to hire temporary staff locally – and how easy. This will help you decide whether to splash out on that particular frill.
What business insurance do I legally need?

If your company has a direct interface with the public, public liability is a must, although again not a legal requirement. Injury to a member of the public can be a very costly business if their injury is serious so insurance is very important. If you make a product which could potentially harm anyone, then product liability is a good thing to carry in your insurance portfolio. A little imagination is needed here – if the product could cause harm to a reasonable person when being correctly used, you should buy the insurance.

There are many others insurance policies which the prudent business person may choose to take out and here the local insurance broker can be of great help. Professional indemnity, in these litigious times, is a must if you give advice or a service; business interruption will keep you going during repairs or litigation – your broker will be able to help you choose both what and how much cover you decide upon, over and above the legal requirements.