small business insurance - basic principles

Arranging insurance for a small business can be a highly complex undertaking, and may require a considerable amount of thought and planning.

Small business insurance is not like most other forms of insurance. If you are looking to insure your home or your car, then there is something tangible to identify, and certain risks it is possible to insure and rate probability of.

The nature of a small business means that there are a large number of variables that can alter they nature of risk involved, and a much greater choice once risks are identified, between arranging insurance and deciding to self insure or run the risk yourself.

The first thing to clarify is what constitutes a small business. This matters because many figures are bandied around which are somewhat misleading. This is because various government and state bodies like to categorize things, and therefore come up with defining a small business as one employing under five hundred people or under one thousand people etc. truth is that a small business can be one person working from home, up to any size really, possibly several thousand employees.

This has changed considerably recently with the advent of the internet and the ability of people to work from home as full time or part time employees of a business or simply to be self employed.

Many small business's don't need a physical office any more, they can work in a virtual one from anywhere they like. This matters because if you are running a small business from home, it can directly impact your normal domestic house or contents or car insurance, which is something most people don't realize.

If you are working from home, you need to let your insurance company that insures your house or your car know. They may be ok with it or they may place restrictions, in which case you would need to arrange a different insurance somewhere else. In any event you need to let them know, because if anything happened and you didn't tell the, it could well invalidate your existing policies.

This is a basic precondition before you go on to consider other types of insurance or risk management. If you are not working from home, then there is a fair chance you are using premises that you either rent or have bought, and possibly employing other people as well.

If that is the case, then there are a range of insurance issue you need to look at, conce
ing premises insurance, car or car fleet insurance, and perhaps most significantly, your legal and moral responsibilities towards your employees.