When running a limited company in the UK, having the right business insurance is important. It can give you financial protection against many risks. From client disputes to property damage, unexpected events can affect businesses of all sizes.
In this guide, we explain the main types of limited company insurance that small businesses might need. We highlight what each type covers and how brokers can help arrange custom policies.
Why Limited Company Insurance Matters
For many business owners, protecting assets, income, and reputation is crucial. Limited company insurance is designed to support businesses in managing risks such as:
- Legal claims from clients, employees, or third parties
- Damage to business property or contents
- Loss of income following disruptions
- Professional mistakes or advice disputes
Having the right insurance can help make sure that if a claim happens, the business won’t have high costs to pay.
Essential Types of Insurance for Limited Companies
Public Liability Insurance
Public liability insurance can cover claims from others for injuries or property damage related to your business activities. For example, if a client or member of the public is injured on your premises, public liability insurance could cover the cost of compensation and legal fees.
Employers’ Liability Insurance
Employers’ liability insurance may be required by law in the UK for businesses that have employees. This includes part-time workers and apprentices. It can cover claims if an employee becomes injured or ill due to their work.
Professional Indemnity Insurance Cover
Professional indemnity insurance cover protects businesses providing a professional service such as consultancy, design, or advice. It can cover claims for professional negligence. It also covers legal defense costs. Additionally, it pays if a client loses money because of mistakes.
Directors and Officers Insurance
Also known as D&O insurance, this type of cover is for company directors and senior managers. It could cover personal liability if a director faces legal action for their professional decisions or actions.
Business Contents Insurance
This covers business equipment, furniture, and stock against theft, fire, flood, and other damage. For companies operating from an office, shop, or other premises, this type of cover can provide peace of mind.
Business Interruption Insurance
If a business cannot run due to an event like a fire or flood, it can get help from business interruption insurance. It covers lost income and operating costs for a certain time.
How to Choose the Right Level of Cover
The right amount of cover depends on factors such as:
- The size and type of the business
- The number of employees
- The value of property, equipment, or contracts
- The nature of the services provided
It is important to review each type of cover carefully. Having too little insurance may leave gaps in protection, while over-insuring could lead to unnecessary expense.
Why Small Businesses Should Consider Combined Policies
Many limited companies arrange combined business insurance policies that include several covers under one package. This approach can save time, simplify renewals, and may offer better value.
How Brokers Can Help Protect Your Business
We support limited companies in exploring the level of cover needed for their specific risks. By helping arrange tailored insurance from regulated providers, we assist businesses in ensuring that:
- Their professional indemnity insurance cover reflects the services offered
- Public liability insurance limits are appropriate
- Directors and officers have financial protection in place
- Insurance can cover a wide range of potential risks
Working with a broker can give you peace of mind. They help ensure your company has the right protection. This support can help manage claims and legal actions effectively.