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INSURANCE AGAINST FIRE AND OTHER PERILS

This covers destruction or damage to your buildings and contents through fire. You can also be covered for other risks such as lightning, explosion, aircraft, storm, flood, riot, malicious damage and so on. If you work from your own home, you will still need to get your own insurance policy and there are some special schemes available.

Worth getting? Yes.

INSURANCE FOR LOSS OR PROFITS

This covers you if your business is disrupted by fire or some other insured peril. It can pay out money to pay your employees, maintain your profits and pay for the extra cost of your fill-in working premises.

Worth getting? Depends on your business. In most cases, yes; but if your business is small with few employees, and you could easily find somewhere to work, for example, you home, you may not consider it necessary. Note that using your home could cause problems with insurance so check with your insurance company. Rather than insure for full loss of profits, you could consider insuring for the cost of finding somewhere else to carry on working.

3. INSURANCE AGAINST THEFT

This covers you for loss or damage to the contents of your premises. Theft for insurance purposes means that someone has forced an entry to or exit from your workplace, so if you want to be covered against theft by your employees or visitors, you’ll have to pay extra and get fidelity insurance.

4. LOSS OF MONEY

Cash and near-cash, such as cheques, stamps and so on, can be insured against theft from your premises or from the homes of directors or employees of your company or in transit.

Worth getting? Yes, if your takings are in cash. Otherwise, no.

5. GOODS IN TRANSIT

This insurance covers loss of or damage to your goods in your own vehicles, or other means of delivery, such as post, road haulier and so on.

Worth getting? Probably, unless you don’t sell in this way.

6. CREDIT INSURANCE

This protects you against your customers failing to pay. You probably will not be able to get this insurance until you have been in business some time.

Worth getting? Probably not, if you deal mainly in cash or payment on delivery. For selling on credit, by the time you can get this insurance, you will be able to work out for yourself how likely a problem bad debts will be. It is probably better to operate good credit control or use a factoring service. However, if your have only one large or a couple of big customers, you should have credit insurance.

7. PUBLIC LIABILITY AND PRODUCT LIABILITY

This will cover your liability to visitors and members of the public if your business causes injury or illness to them or damages their property. Product liability insurance covers you for these risks which occur as a result of the goods you are producing, selling or repairing up to a limit each year.

You need to make sure that the amount of cover is high enough. Recent damages in the courts have been as high as ?1 million. You may need cover for more than this, depending on your business, especially if you do business in the USA.

Worth getting? Yes. With product liability, you may not need it if your products are very unlikely to cause any damage or if you are in the service business.

8. PROFESSIONAL INDEMINITY

If you are the sort of business where the end product is expert advice, this insurance can cover you against claims from your clients for damages caused by your negligence or misconduct.

Worth getting? Yes. These sorts of claims are on the increase.

9. LEGAL EXPENSES

This insurance would enable you to pay for legal assistance if you are involved in a contractual or employment dispute, plus some other legal procedures.

Worth getting? Probably not. Most legal disputes are generally in the employment field. It would be far better to concentrate on getting well organized in this area to cut the risk of being taken to a tribunal and charged with unfair dismissal or breach of contract, for example.

10. KEYMAN INSURANCE

If your business is heavily dependent on one or a few people for its future success, you can get keyman life insurance, for example, for a sum of ?250,000 to be paid to your business in the event of one of those people dying or being ill for a considerable period. To get cover, you must be able to prove the person’s death would cost your firm money.

Worth getting? Yes.

11. OTHER INSURANCE

There are some other types of insurance which you should consider, depending on your business. These include:

? glass breakage, which is important for shops

? cover for frozen food

? computers and computer records

? fidelity insurance, which covers you against fraud or dishonesty by your employees

? business machines and equipment

? agricultural and fish-farming operations

? directors’ and officers’ liability.

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