Given the number of potential misfortunes a typical limited company owner may encounter during the lifetime of a business, it will come as little surprise that insurance companies can provide dozens of different types of policy to cover pretty much any eventuality.
If you’re in a hurry, you can try Hiscox for an instant online insurance quote.
Some types of insurance are mandatory, but most aren’t. You may even have to take out certain types of cover (such as professional indemnity insurance if you are an accountant or IT contractor) in order to fulfil the terms of a contract with a client or supplier.
Here, we take a look at the most common limited company insurance requirements:
1. Public Liability Insurance
PL insurance will cover you in the event that a member of the public is injured on your premises, or if you damage property on a customer or client site. There is no legal requirement to take out this type of insurance.
2. Employers’ Liability Insurance
This cover will protect your limited company if any of your employees become ill (or worse) at your workplace. This is a legal requirement unless you are the sole employee of your company (i.e. you are a one man band), as long as you own at least half the shares in the company.
3. Professional Indemnity Insurance
If you provide specialist advice via your limited company, PI insurance will protect you in the event of a claim from a present or past customer for negligence, dishonesty, or damage to documents or similar. In some ‘knowledge’ industries, PI insurance is commonplace, and may be required by clients before contracts can be signed.
4. Tax Investigation Insurance
This type of cover will cover the costs of professional representation in the even that HMRC decide to investigate your tax affairs. Depending on the amount of cover you take out, you may even be able to cover the amount of extra tax you are subsequently found to be liable for following an investigation. This type of policy can be taken out for under £150 per year, and in our opinion is very worthwhile, given that many limited company directors worry about their financial situation more than any other aspect of their business.
5. Other Types of Insurance
Other commonly purchased policies by limited company owners include vehicle insurance, property and contents insurance, director’s insurance, office equipment insurance, and key man insurance.
The leading business insurance providers will be able to provide cover for almost any eventuality.
Where to get an insurance quote
We have partnered with Hiscox to provide business insurance for our visitors for the past 5 years or so. You can get a business insurance quote right away by clicking here.
For tax investigation insurance, including IR35 cover, we’ve always recommended Qdos Consulting.
- What is professional indemnity insurance?
- What business insurance costs can you claim via your company?
- Professional Indemnity insurance for umbrella company contractors
- What are public liability and employers liability insurance?
- Guide to directors’ and officers’ (D&O) insurance
- ClearSky Accounting - specialist support for contractors
- Visit Hiscox for Professional Indemnity and Business Liability Insurance
- Contractor Finance - up to £30,000, when you need it
- InTouch Contractor Accountants - Personal Online Accounting
- Join PCG - Free impartial start-up advice for contractors.
- Visit Qdos Consulting for tax investigation cover and IR35 insurance.
- 90% Pay Retention for Contractors - Helix Management Ltd