Twas ever thus!
Back to basics on a Friday morning, ready for Monday.
When you start a business you will need some insurance, but what are the very basic covers you need on day 1?
Its best to think of them in three categories, which are:
- Damage or destruction of physical assets – Buildings, stock equipment etc…
- Interruption loss of profits
- Liability for things other people might claim against you
Damage is covered by what are called specified PERILS, things like Fire, Lightning, Explosion, Theft and Accidental damage. There is a long list of what is covered, but you need to be aware primarily of what is NOT covered so you can aim off for those circumstances.
Wear and tear, gradual deterioration, war, nuclear explosions, sonic bangs, electronic malfunction and disease being some of the main ones.
Next, we look at interruption loss of profits. This covers the loss of income if you can’t trade following a material damage loss as above. There are soe other limited benefits, but they are small. Failure of utilities, damage t suppliers or customers, murder death and suicide, and damage related denial of access.
Finally, we look at liabilities. Primarily Public, Products and Employers liability. In all cases they ae covering INJURY or DAMAGE caused to other people outs ide your organisation, on in the final case your employees, where it can be proved the injury or damage was the fault of your organisation.
You should note that Employers Liability is required by law and failure can result in fines up to £2,500 pe day or in extremis up to 6 months in jail.
Professional liability is also an issue where you provide a service or give advice. This covers financial losses suffered by your clients where they allege it results from your negligent errors or omissions. You did something wrong, or you didn’t do something you should have.
These are the three basic elements that form the bedrock of any commercial insurance programme. There are of course many more such as credit, cyber, crime, goods in transit, money, marine cargo all of which would be taken into account in specific circumstances.
After 40 years I still learn something new every day, because the world of business doesn’t stand still and the products that can be put in place to respond change and develop over time #becauseaccidentshappen to nice people all the time.
If you’d like to know more just drop me a line.
Have a great weekend.