Public liability insurance
If members of the public or customers come to your premises or you go to theirs (including if you work from home), you should think about taking out public liability (PL) insurance.
PL insurance covers any awards of damages given to a member of the public because of an injury or damage to their property caused by you or your business.
Employers' liability insurance
Employers' liability (EL) insurance enables businesses to meet the costs of damages and legal fees for employees who are injured or made ill at work through the fault of the employer. Employees injured due to an employer's negligence can seek compensation even if the business goes into liquidation or receivership.
By law, an employer must have EL insurance and be insured for at least £5 million. If your business is not a limited company, and you are the only employee or you only employ close family members, you do not need compulsory EL insurance.
Professional indemnity insurance
If you are in the business of selling your knowledge or skills, you may want to consider taking out professional indemnity (PI) insurance.
PI insurance protects your business against claims for loss or damage made by a client or third party if you make mistakes or are found to have been negligent in some or all of the services you provided. PI insurance will also cover legal costs. Many professions are required to have PI insurance cover as a regulatory requirement or as part of their professional authorisation.