Businesses of all sizes need insurance, but it can sometimes be a challenge to fully understand which policies are needed and which limits should be put in place.
The insurance needs of individual businesses can vary greatly from one to another, with policies dependant on things like location, number of staff members as well the industry you operate in. If you're struggling to understand the types of insurances your business might need, you're in the right place.
We've gathered together three of the more common types of business insurances and at what point they become applicable to your business:
Commercial Property Insurance
This type of policy is designed to protect your business from damage or claims from third parties injured on your premises. It could cover anything from office space to a retail store, and it generally includes protection for equipment and general supplies. In the event of an incident, this policy would pay for any damages to your premises or fund for the replacement of important equipment.
Although this may sound simple enough, cyber insurance actually covers a variety of different events - making it crucial for even smaller businesses. If you store customer data electronically, such as credit card numbers or personal details, you could vulnerable to a data breach. Businesses have to report all data breaches to affected customers which can turn out to be quite costly - especially if these customers then take legal action against you.
This type of policy will protect any managers or board members your company may have against lawsuits for decisions they have made in the course of working for your business. An investor, for example, could sue a company staff member for a breach of financial duties - and this could run into the thousands of pounds. Directors insurance will intervene to pay for any legal costs or compensation payments arising from this type of occurrence.