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Business insurance you must have

Make sure you stay on the right side of the law with our guide to insurances you must have

There are some insurances you must have. Here's the full list:

Liability insurance

Nearly all businesses need some level of liability insurance, and employer's liability insurance is the most common one. If you are about to take on staff then you should ensure you have this first. Also, if you are thinking of setting up a limited company then it is a legal requirement as well, as technically the company is the employer.   If any member of your staff is taken ill, suffers injury or death and this is deemed to be as a result of their work, then you are potentially liable. Therefore the law states that you must have cover in order to cope with this eventuality. By law employers must have at least £5m of liability, although many policies offer £10m. There are just under 400 deaths and nearly 30,000 major injuries at work each year in the UK, therefore you are well advised not to make any cuts here.

Motor insurance

As any driver knows, motor insurance is a legal requirement, but many come unstuck when using vehicles for work related activities. You might think that your current insurance covers you, but unless your policy includes work use then you are mistaken. The good news is, however, that this is not normally expensive and some insurers offer it for free. If you are employing someone who is using their own vehicle for work purposes other than travelling to work, then you have a responsibility to ensure they are fully covered. A work purpose could be as innocent as dropping you off at a meeting – it doesn't matter – they still require business insurance. It is also highly advisable to check with the DVLA that your staff are legally able to drive and take copies of their insurance and MOT documents, as well as their driving licences.

Public liability

Public liability insurance, though not compulsory, is something only the most cavalier business would cut back on. It covers you for damage against property or persons that you might encounter during your work. Many clients won't deal with you or can't legally deal with you unless you have it, so you might consider it to be obligatory.
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