3 of the most misunderstood insurance types for businesses

Starting a business is exhilarating. Insurance isn’t. Dependent on the type and size of your business, you’ll likely need some level of insurance to legally satisfy your business duties. Finding out what is and isn’t applicable to you, is stressful, time-consuming and can make you feel out of your depth.

Due to this, a number of businesses tend to opt for the cheapest insurance out there and hope they don’t pay the consequences when things go wrong. In turn, this only serves to put excess pressure on you as you try to grow your firm and puts your company at increased risk. We’ve compiled three insurance products that often go unnoticed which can truly help you in times of need.

Business Interruption

People who take out stand-alone buildings and contents policies often believe these include business interruption, but this isn’t always the case. Business interruption cover seeks to mitigate the loss of income that comes directly after a disaster. A period of indemnity runs from the initial loss until your usual business can resume, so you’ll need to consider how long this will be to accurately and appropriately cover your business.

If you opt for an indemnity period of 12 months but it takes 18 months to get yourself back on your feet, you won’t be covered for the 6-month shortfall. Business interruption can accompany buildings, contents, stock and more to safeguard against unforeseen events which cause loss to you and your company.

Directors & Officers Liability

Directors and Officers liability, or D&O, is often overlooked on the basis that the company’s insurance covers senior staff. This isn’t necessarily the case. If you are a director, officer or trustee at a company, the decisions you make can negatively impact many people. You could make an error leading to financial loss or be negligent in relation to health and safety which leads to a corporate manslaughter case.

If such a claim is made against you, you are held personally liable, not your company. This can result in civil proceedings and large fines or criminal prosecution leading to huge fines or even imprisonment. Even if the claim made against you is unfounded, the legal fees associated with it can be large. Thankfully, liability cover helps to protect from such circumstances and gives you and your company the confidence to operate as you normally would.

Cyber Liability

The major issue why misinterpreting cyber liability insurance is so prevalent is believing such an attack won’t happen to you. In reality, hackers have proved in recent years that motivations are not always monetary and any company can be hacked, in any sector, at any time. Cyber liability covers for such circumstances and usually includes malware, ransomware and crisis containment and dealing with the leaking of sensitive information.

Indeed, if you work in the public sector or with sensitive data, your business can be severely punished if it is liable for a cyber-attack. Of course, other implications following a cyber-attack could destroy the face of your business, with your current customers losing faith in you and potential customers having no trust in you. Since any sector can be targeted, adequate cyber liability insurance has become a business essential over the past decade.

The Chartered brokers at Hine can often combine your business insurance into one single policy, so there’s less paperwork for you to fill in. If you’d like to find out more about one of these products and how they can help your business or to find out about our comprehensive business insurance policy, we’d love to hear from you. Call us today on 0161 438 0000 or email info@hine.co.uk.

Andy Guy
Andy Guy

Hi there! I'm Andy, I'm the Head of Charity and Faith Insurance at Hine Insurance with over 30 years experience.

In my spare time, I'm a trustee of a church and I enjoy walking and getting to grips with the garden.

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