Before we dive into why your business needs to be insured, let’s look at "What does SME stand for in insurance?"
SME stands for small or medium-sized enterprises. Often, picking the right kind of insurance for your company and its needs can be tricky; hence, it is always best to get in touch with insurance brokers who can help you with your company's insurance coverage so that it can protect you in the event of unforeseen circumstances and assist you in choosing the right type of insurance for your specific business.
Here are five reasons why your SME needs insurance.
Businesses can safeguard themselves against the danger of liabilities brought on by lawsuits and claims filed against them for accidental injury and property damage caused to others, by getting liability insurance. Having the correct type of liability insurance for your business can help to protect your employees.
If an employee or former employee sues your company for illness or injury brought on by their work, employee liability insurance will cover legal defence fees and if you are at fault will pay compensation up to the cover limit you have arranged (normally £10m). Employers Liability insurance is compulsory by law.
A natural disaster can strike at any time, and if your business is not insured, you will have to spend a large sum of money out of your pocket. A property insurance policy will cover your building and contents in the event of a calamity, fire or theft.
If you’re a small business owner and do not have the resources to restore everything if things go wrong, property insurance can provide peace of mind that you’re protected.
Your potential for financial loss doesn’t just stop at the damage caused to your premises, contents machinery and stock. In serious fires and floods, consider the recovery period and the continuing fixed costs (wages, loans) that you would still need to pay until your premises are repaired and your trading has recovered to pre loss levels. How long will it take? That’s when business Interruption insurance cover is essential.
If you own a business, you can never completely rule out the possibility of being sued by an employee or ex-employee for an injury or illness whilst working for you and your worker's compensation insurance may cover the legal fees, which can be very expensive to pay out of your own pocket
Aside from its many other advantages, SME insurance is just good business practice.
Many customers will require you to have insurance in place if you are visiting, using, working on or at their premises. Its very common for main contractors in construction and allied trades to insist on minimum insurance requirements prior to contracting with you.
Being able to reassure prospective clients that you have SME cover can also build professional trust, establishing your venture as a conscientious, professional SME. Adequate cover can also protect your reputation, helping to avoid negative press and word of mouth if things go wrong and you don’t have the right type of SME insurance.
Regardless of whether you’re required to have SME insurance, it is always a good option to be insured to keep you trading in any given situation.
The type of insurance your business requires will depend on the risks faced by your business, and policies can be built around your specific requirements. You can feel secure knowing that your costs would be covered in the event of an accident, theft, or legal action if your company is properly insured.
This is a marketing article from Towergate Insurance
Alison Wild BCom (Hons), MAAT, MATT, Taxation Technician is a highly respected industry professional who has been working with and advising SMEs in areas including tax, pensions, insurance and marketing for over 25 years. She is a member of the Association of Accounting Technicians (AAT) and Association of Tax Technicians (ATT) and also has 20 years' experience as a residential landlord.
Date: February 23, 2023
Category: Small Business