What you need to know about your business cover
Trying to find the right cover for your business is a bit like trying to find something to wear. There are many different options to choose from, but it all depends on what you need and the conditions you need it for. Even if you do find something you like, it still might not be the perfect fit, and it could be baggy or a bit too tight.
The same applies to business cover. There is so much choice, you could be forgiven for feeling a little overwhelmed with it all. Hopefully, this handy little guide can help you choose the cover that is the perfect fit for you.
Why do I need cover for my business?
The answer might seem fairly obvious, but you would be surprised. Some business owners opt not to have any type of business insurance or business cover at all. So, why do you even need business cover? The simple answer is, it is there to give you financial security and help protect you from the potential risks that could impact your business. Without this type of protection, if an incident occurs, you could find yourself footing a bill that’s hefty enough to cost you your livelihood. The important thing is to understand the type of cover you require to help protect you from the potential risks that could occur in the day-to-day running of your business.
What are the risks?
Good question. As a cover provider, at The Retail Mutual we know all about risks as we deal with them every day, but do you know what risks your business faces on a day-to-day basis?
Understanding and recognising risks can make your business a safer place, and it can help you make sure you have the right type of cover. The best way to identify potential risks is to conduct a risk assessment. A risk assessment allows you to objectively analyse your business premises and make a list of risks that could impact your customers, your staff, or the way your business functions. To help you, we have created a series of downloadable, in-depth risk assessment guides that list some of the most common incidents that can occur, but we have also provided helpful solutions to reduce the risk of them happening.
Once you have a good idea about the type of risks you are facing, then it’s time to choose a cover that could protect you if such an incident occurred.
What are the different cover types and how do they protect me?
We cover over 100 different business types, spanning retailers, service providers, food and drink establishments and other independent businesses on and off the high street. Each business sector has its own set of risks or hazards, so what type of cover should you get? Our business cover is made up of the following cover options:
- Public liability cover
- Employers’ liability cover
- Stocks and contents cover
- Buildings cover
- Business interruption cover
Choosing these cover types will help prepare and protect your business should an unexpected event occur, but what do they mean and what do they cover?
Public Liability cover
Public Liability is there to protect you if a member of the public makes a claim against you or your establishment. Whilst not a legal requirement, it’s usually best practice to have Public Liability in place if you have any dealing with the general public. It provides protection in the event of death, injury and damage to other people’s property resulting from your business activities.
An example of a Public Liability claim in action would be if a member of the public slipped on a wet floor. That person could claim against you for injuries, and your Public Liability cover would be there to protect you. Public Liability claims can take a long time to close and claims can run into many thousands.
Employers’ Liability cover
If you have any employees working for you, whether they are full time, part-time or volunteers, you are required by law to have Employers’ Liability cover. You must have at least £5 million of cover in place, and you can be fined up to £2,500 for each day you do not have Employers’ Liability cover. You may also be fined £1,000 if you do not have a valid Employers’ Liability cover certificate, which must be made available to view when requested.
This all well and good, but what does Employers’ Liability actually cover? Employers’ Liability cover is designed to protect your business against the cost of compensating an employee and any associated legal fees if they suffer illness or injury as a result of their work. An example would be if you failed to provide the proper training or equipment that your staff need to perform their jobs correctly. If they suffer an injury, they could sue you for negligence as their employer.
It is your responsibility to provide a safe working environment for your employees. Whether you are running a restaurant or takeaway, hair salon or barbershop, a convenience store or a fashion boutique, Employers’ Liability cover is a must if anyone else is employed on your premises.
Stock and contents cover
If your business sells a physical product or relies on a product to provide a service, the chances are you will need stock cover, especially if you keep the stock on site. This is designed to compensate you if your stock is damaged, destroyed or stolen, including stock stolen while in transit subject to certain conditions. If you are looking to take out stock cover, you should consider the amount of stock you could have at any given time and the value of that stock.
Contents cover is designed to protect you against damage to or theft of furniture, fixtures, fittings and appliances. For example, if you use a tablet or a similar portable device within your business and it is dropped and broken, Contents cover may cover repair or replacement costs.
If you own your business premises or let out a commercial property, buildings cover is designed to protect you in the event of damage from common risks such as fire, flood, burst pipes or falling trees, including the costs of removing debris and carrying out professional repairs. It can also cover damage to fixed glass, shop fronts, sanitary ware, lamps and signs caused by theft or accidental damage. Please note that if there is evidence of wear and tear to the property or if structures are not adequately maintained, you are unlikely to be compensated for the costs of replacement items or repair work. These are usually the responsibility of the property owner or business owner.
Business Interruption cover
If your business is forced to close due to forces beyond your control, such as a fire or flood, business interruption cover is designed to compensate you for the gross profit you would have made if you had been open. The amount paid is based on how long you have been closed for and your accounts from previous years. At The Retail Mutual we can cover you up to 36 months as standard.
What cover types should you pick?
Hopefully, now you have a better understanding of what type of cover you require; it really does come down to your business type and requirements. It’s always good to be prepared for any potential situation that could transpire.
At The Retail Mutual, we help you create the right cover for you and your business. Our dedicated UK-based team will take you through a quotation to help identify the best options for your needs. Call them today on 0333 2121 280 for a free, no-obligation quote. Alternatively, start your quote online now.