When it comes to setting your business up for success, making sure that your company is adequately insured is one of the most important investments you can make. Every other major investment that your company makes is going to be geared toward reaping future rewards – dividends, profits, equity, etc. However, in the case of business coverage, you are doing a bit of work in the opposite direction; that is; you are hedging your bets against a loss that your company will not be able to weather. 

An insurance premium is a payment you can budget for and cope with. For a company brazen enough to put itself out there without coverage, surprise payments in the form of lawsuits, damages and liability claims could sweep in and smash the company at a moment’s notice. So on that note, the following is a breakdown of the most essential types of commercial insurance along with an explanation of what makes them important:

Protection from third-party claims

If you are a business with a product or service, then you are already vulnerable to third-party claims. There is no such thing as a perfect record, and even companies that embrace the highest levels of quality and safety are still subject to accidents, oversight and human error. Liability coverage ensures that no third-party claim will be able to bring your business operations to a halt. 

This type of coverage is going to be particularly important if you deal with the public, have employees visiting clients and customers offsite or have clients visiting your home or office. Furthermore, if your company can be in any way connected to a product or service – even if you do not manufacture, provide or otherwise distribute it – product liability coverage is paramount.  

Protection from employee-related issues

This tier of protection actually involves a few different types of insurance. Liability coverage plays a role here as well, and employers are required by law to have a minimum amount of coverage to protect against claims that their employers file against them. 

Worker’s compensation coverage is also important. While there is no substitute to protecting the well-being of your employees, those who employ them are still well advised to arrangement protection against an unfortunate accident.  

Property protection

If your business or company owns property of any sort (as virtually all do), then you are going to need at minimum two types of coverage to protect these holdings. The first is, again, liability coverage. Property owner’s liability insurance covers landlord’s or property-owning companies against compensation claims filed by tenants or members of the public. If you own the premises, it is essential to protect yourself against claims of this nature. 

The second is outright property coverage. This will protect your business against damage to the physical property, whether that be through fire, flooding or any other unavoidable catastrophe. This one should be especially fresh in peoples’ minds, given the severe weather laying siege to the UK over the last few months.

Zoe Ferguson is from Cactus Cover, a reputable company based in UK offering commercial insurance for various businesses across the country.