Insurance for Startups
Why do startup businesses need adequate insurance coverage?
Why every startup needs business insurance?
Startups, by their nature, face numerous risks—from financial instability and legal liabilities to accidents and operational failures. Business insurance helps manage these risks by providing financial protection against potential losses. With the right business insurance in place, your startup can protect your buildings, contents, equipment, stock, data, revenue, employees, customers, and your reputation, leaving you free to concentrate on successfully running your business. Also, don't forget your insurance premiums are tax-deductible.
Certain types of insurance are legally required for businesses. For example, employers' liability is a legal requirement if your startup employs staff. Complying with these requirements not only protects the startup from the costs associated with workplace accidents or injuries, but fines for not having the correct cover in force.
Whereas, public liability insurance is critical for startups as it protects against claims of bodily injury or property damage - recommended for all businesses that interact with third parties. While of you provide a service, professional indemnity insurance provides potection against claims of professional negligence or failure to perform professional duties.
Buy startup coverage from the leading business insurers
We work with the leading business insurers to financially protect your startup from a range of diverse risks. Partnering at an early stage with a small business insurer means you'll be sufficiently protected from legal costs, financial loss, claims for compensation, as well as property damage. With access to a wide range of insurance products, we can ensure your insurance policy provides adequate cover. As an insurance broker we can assess your needs and find the right coverage that matches those needs, while cost is a factor it is important to consider the value of the cover offered is just as important.
To obtain your tailored quotation, please complete our digtial onboarding process.
While it might not be top of your to-do list, having the right insurance in place could be the difference between the success and failure of your startup business. If you’re not insured and a claim seeking damages is made against you, ask whether your cash flow is sufficient for company to survive?
How much can startup business insurance cost?
The cost of insurance for startups varies depending on what you do, and what cover you require. There is no one-size-fits-all, your business insurance should reflect your unique set of circumstances. For a small startup business with a couple of employees, meeting your legal obligations and purchasing employers liability' insurance can cost as little as £80 per year or £6.67 per month.
How start-up insurance can help company growth?
Having the right start-up insurance in place to protect your business and your cash flow is essential for startup businesses and it also demonstrates to new clients and investors that you’re serious about what you do. Likewise staff, directors and potential investors will be reassured that you have a cover in place to protect the activities of the business. In an increasingly litigious society protecting your company with covers such as professional indemnity insurance, has never been more important.
Promotes confidence
Having adequate protections in place promotes confidence in the business that you have the financial resources at your disposal should the worst happen.
Contractual obligations
It's common practice for counter-parties to request minimum amounts of insurance cover when negotiating contracts for goods and services.
Find startup business insurance that is tailored to the specific needs of your industry
Business insurance is an important consideration for any startup, talk to a broker today about your requirements.Will our business insurance evolve as our startup grows?
Size of the business
As your business grows so will your insurance requirements. Additional covers are typically purchased along with higher coverage limits to ensure the balance sheet is adequately protected.
New products or services
If you pivot into offering different services or different industries, it is vitally important that you keep your insurance broker up to date to ensure your current business insurance is suitable.
Emerging risks
The environment in which you operate continues to change, therefore consideration should be taken to emerging risks. Every business should consider their insurance program each year to ensure you are protected from new exposures.
When is the best time to get business insurance?
Early consideration
While Employers Liability is a legal requirement, other types of insurance are optional, however, having a business insurance package is vital to protect your business, even if you haven’t taken on your first employee and could be the difference between success and failure if the worst happens and something goes wrong in the early stages.
How do insurers calculate your startup insurance premium?
If your business does not have a trading history, it is prudent to offer conservative projections for your first year's revenue. Given insurers will base their premium calculations from these projections.
It's common for startup businesses to identify overly ambitious revenue projections, however it is wise to stand back and consider what is reasonable with so many unknown factors that could hamper your targets.
The industry you work, the type of services you provide, annual revenue and employee numbers, alongside other individual business differences will all factor into insurers calculations for insurance premium.
What are the largest insurable risks facing startup companies?
The exposure to risks as a startup might appear smaller compared with large corporates, but an unfortunate accident can spell the end for a startup business. Losing valuable assets or third parties taking seeking damages against the company can bring unmanageable costs, before the business really has a chance. If you require insurance for your software company please follow the link.
Compensation claim
These occur when a third-party demands damages from your business and takes your to court to see compensation for a loss they have suffered.
Financial loss
If your business suffers damage, destruction or theft of property you own, how easily can your startup replace those items that are essential to trade?
Legal costs
The cost to defend a liability claim made against the business can be very expensive - legal fees can mount up very fast and cause significant financial harm.