Starting a business is exciting, but it also comes with risks. At Ashburnham Insurance, we know that protecting your business from the unexpected is just as important as growing it. Whether you’re a tradesperson, consultant, or online entrepreneur, having the right insurance in place can save you time, stress, and significant financial loss. To help new business owners navigate the world of insurance, we’ve created a practical checklist of the key areas to consider.
1) Business Type
The first step in choosing the right insurance is understanding your business structure. Are you a sole trader, a partnership, a limited company, or running an online venture? Each business type comes with different legal obligations and risk exposures. For example, sole traders may require different levels of coverage compared to a limited company, particularly when it comes to liability protection. Knowing your business type ensures that you choose policies tailored to your specific legal and operational needs.
2) Do You Have Anyone Working for You?
If you employ staff, even on a part-time or casual basis, you may be required by law to have Employer’s Liability Insurance. This protects you if an employee is injured or becomes ill due to work-related activities. Even if you only hire labour-only subcontractors, it’s important to understand your responsibilities. At Ashburnham Insurance, we help business owners ensure they have the correct cover to meet legal requirements and protect their workforce.
3) Do You Use Tools or Equipment?
Most businesses rely on equipment, tools, or stock to operate effectively. If these items are lost, damaged, or stolen, it can halt your operations and lead to unexpected costs. Tools and Equipment Cover or Business Contents Insurance can protect against these risks, giving you peace of mind. For example, a tradesperson losing essential power tools on-site could face significant downtime, but the right cover ensures replacement costs are handled efficiently.
4) Do You Use a Vehicle for Work?
Many small businesses rely on vehicles to deliver services, carry tools, or visit clients. Using a personal car for business purposes or owning a commercial van comes with its own set of risks. Standard car insurance may not cover business-related travel, so commercial vehicle or business-use car insurance is essential. This ensures you’re protected in case of accidents, damage, or liability claims arising from business-related journeys.
5) Do You Work at a Customer’s Property?
Visiting client homes or workplaces exposes your business to potential claims if accidents occur. Public Liability Insurance covers injury to others or damage to property caused by your business activities. For example, if a plumber accidentally causes water damage while on-site, Public Liability Insurance can cover repair costs and legal fees. This type of cover is particularly important for tradespeople, contractors, and service providers who work off-site.
6) Do You Provide Advice or Professional Services?
If your business involves offering advice, technical guidance, or professional services, you may be at risk of claims if a client feels your work caused a financial loss. Professional Indemnity Insurance protects your business against such claims, covering legal costs and potential compensation. Consultants, designers, trainers, and IT contractors, for instance, benefit greatly from having this cover in place to safeguard their reputation and finances.
7) Could an Accident Affect Your Income?
Your ability to work may be disrupted by injury, illness, or other unforeseen events. Personal Accident Insurance provides financial support if you’re unable to earn due to a covered accident. This cover can help you maintain income, pay bills, and support your business while recovering. It’s especially valuable for self-employed business owners whose livelihood depends entirely on their ability to work.
8) Do You Use Hired or Rented Equipment?
Hiring equipment or machinery can be essential for certain jobs, but it brings additional risks. Hired-In Plant Insurance protects against loss, theft, or damage to equipment that isn’t owned by your business. This type of cover ensures you won’t face substantial replacement costs, allowing you to complete projects without financial disruption.
9) Are There Any Contract Requirements?
Some clients or contracts may stipulate specific insurance requirements, such as minimum Public Liability limits of £1 million, £2 million, or higher. Checking these requirements before starting work ensures compliance and prevents contract disputes. Ashburnham Insurance can advise you on appropriate coverage levels to meet contractual obligations while avoiding overpaying for unnecessary cover.
10) Final Checklist
Once you’ve considered these factors, it’s time to confirm that your insurance covers your key risks. Make sure you’ve assessed legal obligations, identified operational risks, checked contractual requirements, and chosen the right levels of cover. Keeping your insurance documents organised and accessible also ensures a smoother claims process if the unexpected happens.
Starting a business comes with exciting opportunities, but also responsibilities. Protecting your business with the right insurance is one of the smartest steps you can take. At Ashburnham Insurance, we work closely with start-ups to provide tailored policies that give business owners peace of mind and allow them to focus on growth. By following this checklist, you’ll be well-prepared to face the challenges of running a new business with confidence that you’re covered every step of the way.