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Commercial Insurance : Business Insurance

Landlords Insurance : Liability Insurance

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Business Interruption Insurance - Even minor damage to your property could seriously disrupt your business leading to loss of income and extra expenses.

Business interruption insurance will compensate for the short-fall in gross profit together with paying any increased working costs and extra accountants’ fees incurred.

When arranging this insurance you will need to estimate the maximum time needed to get your business working normally following the most serious damage. The insurers will ask for an estimate of your anticipated gross profit. If an auditor later certifies an actual figure materially lower than this estimate, a return of premium is normally given.

Book Debts - cover against loss of money arising from accidental damage or theft of books of account.

Building Sum - The sum insured under a buildings policy must be the full rebuilding cost of the home. The market value of your home or the Council Tax band valuation have no direct relationship to the rebuilding cost of your home.

An online Household Rebuilding Calculator is available here

Engineering Insurance - Engineering insurance provides cover against electrical or mechanical breakdown for most machinery, including computers. By law, many items of plant such as boilers, lifts and lifting machinery must be inspected regularly by a qualified person. Our Company can arrange insurance cover with insurers to provide this service.

Employer's Liability Insurance - By law, all employers must insure against their legal liability for injury, disease or death to employees sustained by them and arising from their employment.

Employees will normally include, in addition to those under a contract of employment, apprentices and other trainees and those hired from another employer. The only exception is where all your employees are close relatives and you should check if you think that this may apply to you.

You are legally required to insure for at least £5 million but in practice, most policies offer £10 million minimum cover. The law also requires that you exhibit a certificate of employers’ liability insurance at each place of work. Failure to meet this requirement could constitute a criminal offence.

Fidelity Guarantee - cover against loss of money or stock arising from dishonesty by your employees.

Frozen Food - cover against loss of frozen food in deep-freeze units caused by breakdown or damage to the unit or failure of the electricity supply.

Goods in Transit Insurance - Goods in transit insurance covers goods against loss or damage while in your vehicle or when sent by carrier. The sum insured may be a limit for each vehicle or any one consignment.

Glass - cover for the replacement of glass following malicious or accidental damage.

How much should I insure for? -

Buildings the business premises should be insured for the full rebuilding cost (including professional fees and the cost of site clearance) and not just for the market value. You may need expert advice to calculate the rebuilding cost, which often differs significantly from market value.

If your business is in leased premises we suggest that you check with the building owner that they have adequate insurance provision.

Contents – your stock should be insured for its cost price without any addition for profit. Provision can be made for seasonal stock fluctuations. Plant and business equipment can be insured on either a "replacement as new" or an "indemnity" basis. If indemnity is chosen, wear and tear will be taken into account when settling any claims.

Legal Expenses Insurance - The cost of taking or defending legal action could place a considerable financial strain on your business. Legal expenses insurance (LEI) covers legal costs such as solicitors’ fees and expenses, the cost of barristers and expert witnesses, court costs and opponent’s costs if awarded against you in civil cases.

Types of dispute normally covered include contractual and employment matters, for example claims for unfair dismissal; racial or sexual discrimination, the recovery of bad debts, and disputes with a landlord other than those relating to rent or service charge (particularly relevant for small businesses when dealing with a large corporation or local authority landlord).

The policy cover will also include the cost of employing specialist accountants and lawyers to protect your rights, for example if your business is subject to investigations on tax or VAT matters. Most policies will offer a confidential telephone legal advisory service to answer commercial legal enquiries.

The vast majority of LEI policies are sold 'before the event', to cover the consequences of an event which has not yet occurred. However, there is a very small part of the market which is sold 'after the event', to cover legal expenses in a case where the disputed event has already happened, although the expenses of the court case resulting from it have yet to be incurred. It is likely to be available only where the chances of winning the case are high, in which case the insurer is likely to be able to recover the costs from the other side.

Legal Liabilities - Running a business creates considerable legal responsibilities towards your employees, the public and customers. Injury to your employees and members of the public could result in you being legally liable to pay damages if you or your employees have been negligent or found in breach of a statutory duty.

An employer's statutory duties are set out principally in the Health and Safety at Work etc Act 1974 and associated Regulations. You must identify the safety and health needs of your particular business activities by carrying out a risk assessment and take action to remove or control the risks in line with the appropriate legislative requirements. Good management is an ongoing process. Should you make any changes in your workplace, you should reassess the hazards present.

Advice on good health and safety management is available from the Health and Safety Executive and local authority environmental health departments. In addition the liability insurers our Company would recommend to you will be able to provide assistance with risk assessments and action plans.

Liability insurance will pay the amounts of any court awards or damages, claimants’ costs and expenses where you or your employees are held legally liable, subject to any policy limits.

The main liabilities which you face in business are:

Employer's Liability Insurance
Public Liability Insurance
Product Liability Insurance

Money Insurance - Money insurance is on an "all risks" basis and covers cash, cheques, postage stamps and certain other negotiable documents.

Different limits will apply to money on the premises in and out of business hours, in safes, at the homes of directors or employees and in transit. There may be requirements in the policy relating to safe keys and the method of transit.

Personal assault cover may be included, which will provide compensation for you or your employees following injury during theft or attempted theft of money.

Motor Vehicle Insurance - By law you must insure your legal liability for injury to others and damage to their property arising from the use of vehicles on the road – third party insurance.
Most business policies are either comprehensive or third party, fire and theft.

Comprehensive cover includes damage to your vehicle. The third party section of a commercial vehicle policy will meet your legal requirements to cover your liability to others.

Your insurers will require full details of the types of vehicle and their usage, details of goods and samples carried, details of drivers and, where applicable, the maximum number of fare-paying passengers.

If you own more than five vehicles, a fleet policy may be arranged. The claims experience of your fleet will provide the main rating factor in assessing the cost of the policy.

Property Insurance - Buildings and contents can be insured against fire, lightning, explosion of gas and boilers used for domestic purposes without the addition of "special perils" such as explosion, riot, malicious damage, storm, flood, impact by aircraft, road and rail vehicles, escape of water from tanks or pipes and sprinkler leakage.

"All risks" insurance gives wider cover including any accidental damage or loss not specifically excluded. However "all risks" will not cover wear and tear, electrical or mechanical breakdown and gradual deterioration that will be specifically stated in the policy document.

Public Liability Insurance - Public liability insurance covers your legal liability to pay damages to members of the public for death, bodily injury or damage to their property which occurs as a result of your business activities. It also covers legal fees, costs and expenses such as representation at any coroner’s inquest, fatal accident enquiry or other court hearing because of an accident.

When deciding on how much cover to buy, you should carefully consider the maximum claim that could be made against you. Awards for injury can exceed £1 million. Certain businesses, where there is a spreading fire or possibility of multiple personal injuries, could face claims for damages far exceeding this figure. The limit of indemnity will apply to claims arising from a single incident.

Product Liability Insurance - If you make, repair or sell products, you could be held legally liable for damage or injury arising from defects in their design or manufacture even if you have not been negligent. Product liability insurance covers you in these circumstances up to a maximum amount each year.

The Consumer Protection Act 1987 makes it a criminal offence to supply unsafe consumer goods.

Personal Accident and Sickness Insurance - This type of policy pays a regular cash benefit to a person unable to work as a result of an accident or sickness. This is especially valuable if you are self-employed and would have no income if disabled or sick. Personal accident policies are arranged for one year and are renewable at the option of the insurer. If you are sick or injured, regular payments are usually made on a weekly basis up to a maximum number of weeks (usually 52 or 104). There will normally be a deferred period (such as 7 days) before payments start. A lump sum may also be payable on death or specified disabilities such as loss of a limb or eye.

Theft - Contents are usually covered against theft providing there has been forcible and violent entry to or exit from the premises. Damage to the building resulting from theft or attempted theft will also normally be covered. Theft by employees is usually not covered – cover against employee dishonesty can be arranged by a fidelity guarantee policy.

For equipment used away from the insured’s business premises such as lap top computers we recommend optional “All Risks” insurance to provide both theft and accidental damage cover.

Travel Insurance - individual or group travel insurance policies can be arranged providing cover during business journeys abroad which includes medical and legal expenses, personal accident and loss of baggage.

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