Managing the risk of starting a business

There is lots of think about when you are starting up a new business whether you employ staff or simply work alone.

Whilst not being the most obvious consideration, business insurance could be one of the most important investments you choose to make.

If you employ people it is a legal requirement to include employers’ liability insurance which essentially covers you should any of your staff be injured in a work-related incident – and of course if you drive a vehicle you will almost certainly require commercial motor insurance.

‘Getting by’ on domestic use car insurance will not work and you will not be covered.

Just like your home insurance, commercial property insurance is important to cover you for any loss or damage to your premises, stock or equipment and if members of the public visit your premises on a regular basis, you will also require public liability insurance.

If you deliver professional services and are offering specialist advice it may also be sensible to have professional indemnity insurance which covers the cost of any potential compensation claims brought against you by customers/clients who believe the advice was wrong or inappropriate.

Clearly, it is unlikely you will require all the insurances I’ve outlined from the start of a new business, but most of them come into play as businesses grow.

The modern digital world has also thrown up things like cyber insurance which provides peace of mind in the event of a major cyber attack and subsequent loss of information, data, IT systems and so on.

A business can be brought to its knees by this type of situation.

There are so many stories about people whose businesses fail because something terrible has happened and they had failed to secure appropriate insurance.

There are lots of other additional insurance policies available for a wide range of special risks/circumstances but the best thing to do is consult with your insurance broker for advice.

In all walks of life, it is surely better to be safe than sorry…..and business is no different.