Five-step guide to help business owners make a more informed decision and save cash

Whether you’re a high-flying business owner or a budding entrepreneur starting out with a great idea, sooner or later you’re going to find yourself wandering aimlessly in the minefield of business insurance so here are my top five tips.

1. Meet your legal requirements
You MUST meet your legal requirements. The only business insurance mandatory under UK law is employer’s liability insurance. This is required by all businesses that employ staff, whatever their contracts. However, if your business operates vehicles, it’s mandatory by UK law that you have third-party insurance vehicle insurance to cover claims made against you from third parties. Some industry regulators may also require you have insurance cover in place. For example, solicitors and accountants are required to have professional indemnity insurance. To discover the legal requirements of your business please refer to for information or talk to your local council.

2. Understand your risks
Next, you should assess the risks within your business. These are unique to each company. It’s best to make a list here. Always look at risks that are ‘reasonable’ and could happen. Here are some example scenarios. If you run a logistics company, it’s reasonable that one of your vehicles could be involved in a road accident. This could injure a member of the public, your staff, or damage the goods being transported. This could help inform your insurance needs. Let’s say you run a local internet café. What could go wrong? Your computers could fail; stock could be lost in a fire or a customer falls down the stairs. So you might want insurance to cover mechanical breakdown, accidental damage, public liability, and buildings contents.

As you can see, both businesses have different risks. Start by asking yourself:
• What incidents could occur within my business?
• Could members of the public or staff be injured?
• Could any high-value items be lost?

3. Know exactly what insurance you need
Now you understand your risks, you’re better informed to contact an insurer. Your list could be a big help when making a call. Always outline your risks to an insurer and make sure you get this exact level of cover, no fluff.

4. Be super specific
When you’re specific about your needs, you save time, hassle and money. It’s common for additional and unnecessary cover to be included in your policy. These can cost you money – think PPI. Always question each aspect of your policy.

5. Find a specialist broker
Always deal with a reputable firm with over five years’ experience. Find a broker that only deals with A-rated insurers, and ensure they are regulated by the Financial Conduct Authority.

Callum Watkins is marketing executive at 1st Choice Insurance