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A beginner’s guide to office insurance

September 26, 2011

Office insurance is both broad-ranging and highly specific, as paradoxical as that may sound.

It’s specific, in that it’s specifically tailored to meet the needs of businesses – there is little point insuring your 11th-floor offices on a residential policy that includes protection for garden possessions and the contents of your shed.

But it’s broad-ranging, in that a single policy can often provide all the many and varied forms of protection required to leave your finances safe and secure, whatever happens.

Do I need office insurance?

Certain business insurance policies are mandatory, especially in regulated industries, so you should be aware of any such need. For example, employer’s liability insurance is a legal requirement if you hire somebody to work for you, while many firms will insist you have adequate professional indemnity insurance before they will consider hiring you for contract work.

In most cases, you do not have to have office insurance. However, you should consider whether you can afford to operate without the peace of mind and financial protection that comes from knowing you will receive a payout to keep your business functional if the worst should happen.

What does it cover?

A decent office insurance policy will cover all of the essentials, so unless you have specific additional needs, a standard product might be all you need.

The standard elements will usually include contents insurance, protecting any investment made in furnishings and equipment in the event of fire or flood, theft or other forms of loss.

Some policies also pay out for business continuity costs, allowing you to temporarily relocate, hire equipment and so on to continue trading if your own equipment or premises are unavailable due to damage or loss.

You might even find your policy includes window insurance, to replace the glass if your windows are maliciously damaged or broken during a storm.

Finally, look out for any protection given to cash while it is on your premises, or while it is being taken to the bank by an employee.

What’s left out?

In many cases, office insurance is made up of bolt-ons, rather than core policy elements.

As such, a lot of the more specific aspects of cover might be left out as standard – look out for extras like public liability or product liability, if you need them.

If you are involved in giving advice, especially legal or financial, you may need professional indemnity insurance.

And extra elements of protection may be able to keep you in business if your computer system fails, an employee goes rogue, you suffer from bad debts due to non-paying clients or you are affected by a terrorist act.

What should I watch out for?

As a small business owner or a new start-up, you might not want to spend too much on insurance cover right from the outset but you should protect the most important parts of your business – and make sure you won’t be ruined if your premises are robbed or damaged by fire, for instance.

More help on business insurance