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Online Businesses: Getting the Right Insurance

By Hannah Corbett

It’s just important for an online business to have insurance as it is for a more traditional, offline business. Though an online business may be exposed to entirely different risks than an offline business, it is still equally as important to protect against them.

Without the proper protection in place, an unexpected peril could have the power to bring your business to its knees, and cause financial devastation. In order to make sure your online business is properly protected, you should consider taking out the following forms of cover:

Buildings and contents – You may not have a physical shop or bricks-and-mortar building that people can enter to interact with your business – but chances are it still operates from somewhere, such as an office building. Even if you do not own your business premises, warehouse, or any other buildings that you use to run your business, you may still have to insure them against damage.

When it comes to contents, your stock, furniture and business equipment are often valuable, and not always replaceable. Usually, it’s worth insuring your business buildings and contents in case the worst should happen. Try to consider, realistically, the cost of repairing major fire damage to your business building, or replacing your entire stock – could you afford it?

Public liability – If your business is deemed responsible for causing harm to a member of the public, then you could be taken to court, in which case you might have to pay for legal defence, plus any resulting compensation. A public liability insurance policy could help you with this financial burden, if you are caught in an awkward situation.

It’s worth noting that public liability does not usually cover injury or damage caused by one of your products – for that you would need a public liability insurance policy.

Employers’ liability – If your business relies on staff – full time, part time, or even unpaid – then there’s a good chance that you’ll be legally required to have employers’ liability insurance in place. This policy can provide financial protection for you in the situation that a member of your staff becomes ill or injured as a result of their working duties, and makes a claim against you as a result.

Cyber liability insurance – This type of cover is particularly pertinent to a business operating wholly or largely online, as it offers protection from risks encountered through working with and on the web. For example, some of the things that may be included in cyber liability insurance could be data protection, computer virus liability, network security liability, and even the repair of online reputation damage. Of course, the exact terms and extent of cover you will need to discuss with your insurance provider, as you may find variations between different insurers.

No matter which sector your online business operates in, you should consider taking out insurance to protect against the unexpected. No two businesses will necessarily have the same insurance, though, no matter how similar they appear to be. As a business owner, it’s up to you to know your business and its weaknesses, be able to identify the areas in which it may be most vulnerable, and then take out the best insurance to protect that. Carrying out a proper risk assessment is an absolute must when considering business insurance, and should be done carefully and thoroughly. The most important thing to remember is to take your time, consider all the options before buying, and aim to strike a balance between price and protection.

About the Author
Hannah Corbett is a copywriter who specialises in the small and start up business worlds. Much of her time is dedicated to keeping up to date with the latest in SME news, as well as producing useful content and tool to help small businesses develop and grow. You can follow Hannah on Twitter, or connect on Google Plus, or, to find out more about business insurance, visit www.makeitcheaper.com.

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