Commercial Insurance in Leicester
Commercial Insurance in Leicester
What the law requires
Employers' liability insurance is a legal requirement for almost any business with employees, with narrow exemptions. Minimum cover levels apply, and the certificate must be accessible to employees.
Motor insurance is required for vehicles used for business.
Almost everything else is not compulsory by statute — but is frequently required by a landlord's lease, a customer's contract, a lender's conditions, or a trade body's rules.
The main sections
Public liability
Claims from third parties for injury or damage. Check your contracts before choosing a limit; many specify a minimum.
Employers' liability
Claims from your own staff.
Property and premises
Buildings, contents, stock, machinery and equipment. Insured for rebuild and replacement cost.
Stock
Worth its own thought where value fluctuates seasonally — a retailer or wholesaler whose stock triples before Christmas may be significantly underinsured for that period unless the policy allows for it.
Business interruption
Discussed below.
Professional indemnity
Claims arising from advice or services provided.
Goods in transit and fleet
Relevant across the county's distribution sector.
Cyber
Increasingly required in contracts, and increasingly relevant to any business holding customer data.
Business interruption — the section most often wrong
If a fire closes your premises, the property section pays to repair the building and replace equipment. It does not pay the income you lose while you cannot trade.
Business interruption cover does that, and two things about it regularly go wrong:
The indemnity period is too short. Many policies default to twelve months. For a business needing to rebuild premises, re-fit, restock and win back customers, twelve months is frequently not enough. Twenty-four or thirty-six is more realistic for anything involving a physical rebuild.
The sum insured is calculated wrongly. It should reflect gross profit as defined by the policy, which is not the same as the figure in your accounts. Getting this wrong leads to underinsurance and a proportionally reduced payout.
This is the section worth spending an extra ten minutes on at renewal.
Underinsurance applies here too
As with home insurance, insuring for less than the correct value can result in average being applied — a claim reduced in proportion to the shortfall, even on a partial loss.
Review your sums insured annually. Building costs, equipment values and stock levels all move, and a figure set four years ago is unlikely to be right now.
Working from home
A common gap in smaller businesses. A standard home insurance policy generally excludes business activity, stock held at home and clients visiting the premises.
If you run a business from home, tell both insurers. It is usually inexpensive to resolve and awkward to discover after a claim.
Do not simply auto-renew
The most common way a business ends up badly insured is renewal on autopilot.
A policy assembled three years ago reflects the business as it was three years ago. Since then you may have taken on staff, bought equipment, moved premises, started selling online, won a contract with different insurance requirements, or changed what you actually do.
None of that updates itself. Sums insured stay where they were, the described activities stay as they were, and the gap between cover and reality widens quietly.
A useful renewal habit: before accepting, check four things. Has turnover changed materially? Have you added employees? Have you bought equipment or increased stock levels? Have new contracts imposed insurance requirements?
If the answer to any is yes, the policy needs revisiting rather than renewing. It takes twenty minutes, and it is the difference between a claim paid in full and a claim reduced.
What we do
We look at what the business actually does and where its real exposures sit, rather than assembling a policy from a template.
Keep the evidence a claim will need
Claims are settled on evidence, and the evidence is far easier to gather before an incident than after one.
Keep an asset register
— equipment, machinery and fittings, with purchase dates and values. After a fire, reconstructing what was in the building from memory is difficult and disputes over what existed are common.
Photograph the premises
periodically, including stock levels and equipment. It takes ten minutes and it is persuasive.
Store records off site or in the cloud
Accounts, the asset register and the policy documents themselves are of little use if they were in the building.
Keep maintenance and inspection records
— electrical testing, fire alarm servicing, equipment inspections. Insurers ask for them, and a gap can affect a settlement.
None of this is onerous. All of it makes the difference between a claim settled quickly and one argued over for months.
Speak to us
Call 0116 277 7536 or book a free consultation.
Cedar House, 3 Broad Street, Enderby, Leicester, LE19 4AA.
Common questions
What commercial insurance is legally required?
Employers' liability insurance is a legal requirement for almost every business with employees, with limited exemptions. Motor insurance is required for business vehicles. Most other commercial cover is not compulsory by law, though contracts, landlords and lenders frequently require it.
What is business interruption cover?
It covers lost income while your business cannot trade normally after an insured event such as a fire or flood. The building may be repaired under the property section, but the income you lose while closed is only covered if you have this. It is the most commonly underinsured section.
How much public liability cover do I need?
It depends on your activity and who you contract with. Many commercial contracts, and most local authority work, specify a minimum level. Check your contracts before choosing a limit rather than picking a figure that sounds adequate.
Does my business insurance cover working from home?
Not automatically, and a standard home policy usually excludes business activity. If you run a business from home, hold stock there, or have clients visit, tell both insurers. This catches out a lot of small businesses.
Do I need cover if my lender requires it?
If you have a commercial mortgage, buildings insurance will be a condition of the loan, exactly as with a residential mortgage. The lender may also want its interest noted on the policy. Confirm the requirements at the outset.
What is professional indemnity and do I need it?
It covers claims arising from advice or professional services you provide. It is essential for consultants, designers, accountants and similar, and increasingly required in contracts even for businesses that would not describe themselves as professional services.
Related
Important information
This is a general insurance policy with no cash-in value at any time. Cover is subject to underwriting and to the terms, conditions, limits and exclusions of the individual policy. If you stop paying premiums, cover will end.
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