Business Insurance – the Frequently Asked Questions

Setting up your business insurance whether it’s a new policy or renewing an old one can be quite a daunting task. Insuring your company is exceptionally important and so it is necessary to obtain the right insurance for your business. Everyone has many questions when sorting out their business insurance, here are some of the most frequently asked questions and their answers.

Q. What is professional indemnity business insurance?
A. Professional indemnity business insurance provides protection against potential claims of breach of professional duty. It protects the business and their employees, and can sometimes lend to cover consultants who are acting on behalf of the business in question. In some business professional indemnity business insurance is compulsory such as accountants. It covers the business in case of negligence (perhaps giving incorrect information or making a mistake when working on the clients behalf), or loss of professional documents or data and so on. 

Q. What is Business Interruption Insurance?
A. Business Interruption Insurance (sometimes called Business Income Insurance) covers your business for any loss of profits due to your business not being able to run normally for example if the premises become untenable or if the office needs to close down due to legal proceedings if a claim is made.

Q. What information do I need to give in order to obtain a quote for my business insurance?
A. When setting up your business insurance it is recommend to obtain a few different quotes from a few different insurance companies. In order for insurance companies to give you an accurate price regarding your business insurance you will need to answer a series of questions, these may include:

• your profession and industry
• the level of cover you need
• annual turnover, annual gross income, and annual fee income. If the business is new you’ll need to give your first years estimates 
• business name, contact name and email address
• a few things about your business activities
• previous claims history
• the date you want cover to begin 
• bank details

These questions will differ slightly from company to company.

Q. What is an Excess and why do you have to pay it with business insurance?
A. An Excess is the amount you have pay if you make a claim through your business insurance. The amount of Excess you will need to pay is stated in the policy and is a set price; this can be anything from £50 to £1000. The amount of excess you pay is set by the insurer and so it is necessary to check this before committing to a policy.