More and more people are deciding to take the leap and set up their own business – and its innovative youngsters who are leading the way. The number of under-35s creating start-us has risen 70% and this injection of entrepreneurs has fuelled the economy. But are many young entrepreneurs risking bankruptcy without the right business insurance?
It is absolutely crucial that every business has a form of insurance – employers liability insurance is actually required by the law in the UK. But with so many different types of business insurance, it can be overwhelming to say the least for a young entrepreneur or start-up business. Even if you’re running your small business from the comfort of your bedroom, you will probably still need some form of insurance. The insurance experts at Compare Crazy have created this simple breakdown of each type of insurance and the sorts of companies it applies to – read on for the ultimate guide to business insurance.
Professional Indemnity Insurance
This type of insurance is designed to protect business owners if they have been found to be negligent or given poor advice. Clients may check if you have this insurance cover before working with you, so it is definitely a wise investment, even for a small business. Self-employed freelancers can also benefit from professional indemnity cover.
Product Liability Insurance
This insurance is voluntary but could save you a lot of money in the long run if you manufacture or supply goods. A small fault in a product could potentially cause damage to property or a person, opening the gates for compensation claims.
Public Liability Insurance
Even if you work from home or are a mobile freelancer, you could need to be covered for public liability. This insurance covers you against claims made against you or your business for personal injury or damage to property. If somebody trips over a wire or your carpet this could result in a claim, so it’s better to be safe than sorry!
Employers Liability Insurance
This cover is only needed if you are taking on employees, and is a legal requirement for all businesses with members of staff. Issues such as health and safety and redundancy can cause conflicts and end up in court – an insurance policy can minimise the risk and cover all costs which arise from an employee claim. If that isn’t a good enough reason to invest in employers’ liability insurance, then you could get fined if caught without it.
Need any more help with insurance jargon? Get in touch, we can explain everything clearly and help you find the cheapest quote.