Business Insurance through your cis
Whether you’re employed, a director of your own limited company, or a sole trader, you’ll need to be covered by appropriate insurances to protect you whilst providing your services. Now we will do all of the hard work on this, including getting the best deal out of the insurers (because we know how much everyone loves speaking to their insurance company!). But for those of you who like to know what you’re getting for your money, we’ll explain the detail here.
Employer’s Liability Insurance
Ok, so here’s the boring bit. The Employer’s Liability (Compulsory Insurance) Act 1969 says that all employers who have employees working in the UK have to have at least £5,000,000 employer’s liability cover. This is to ensure that there are always funds available, whether the employer can afford it or not, to compensate an employee for a genuine work related claim.
So what is the insurance? Basically, if you have a work related illness or injury and your employer is held responsible for it, then this kind of insurance protects the employer against such a claim. It could be that a claim arises up to 40 years in the future – for example if an employee has an asbestos related illness that relates to their time in a workplace, the employer could be held responsible for up to 40 years, and they have to keep their certificates for that amount of time.
Public Liability Insurance
This is the stuff that protects companies and their workers for claims other parties have made for damage or injury caused by these companies and their workers. The difference here is that the claim wouldn’t be made by an employee, but another member of the public (hence the name).
Public Liability Insurance is voluntary, but most contracts insist on it being in place so that a company providing services can compensate if something goes wrong.
An example of a claim made under this kind of insurance would be where a contractor left computer cables somewhere they shouldn’t be, and someone in the Client’s site tripped over them causing a serious injury. Any claims to be made would come under this kind of policy.
This kind of insurance protects both companies and their workers against any claims made by third parties where there has been negligence in providing some or all of the services. The insurance covers compensation claims and or legal costs too.
Professional Indemnity Insurance
Some professionals must have this insurance, for example accountants and lawyers, and as with Public Liability Insurance, it is generally a requirement in all service contracts that the insurance is in place.
An example of a claim under this kind of insurance would be if data was permanently deleted from a client’s hard drive, due to an error by an employee or contractor. The claim would be for the costs incurred in replacing the data and any subsequent loss of business.
Whilst none of us like to think about making mistakes, this kind of insurance is very important to freelance contractors and provides the peace of mind to their clients that they’re dealing with a legitimate business
Personal Accident Insurance
OK so protecting other people and businesses that you come into contact with is very sensible from an insurance point of view but what about you?
If the worst should happen as a result of an accident at work how have you prepared to take care of you and or your loved ones?
As a contractor you need to make sure that if you are working in environments where the risk of death or serious accident is relatively high then you need insurance protection in place. Paper cuts, however painful, don’t count!
Personal accident insurance and death in service insurance will give you the protection that you need.