About A-Z Insurance Guide

As a contractor insurance is always a serious consideration and should take a high priority on your “hit list”. It is important to make sure that you have the right insurance policy with a suitable level of cover for your business needs. There are 7 basic insurances every contractor should consider before you taking the contracting path,

• Professional Indemnity Insurance
• Public Liability Insurance
• Employee Liability Insurance
• Office/ Small Business Insurance
• Personal Accident Insurance
• Cyber Attack Insurance 
• IR35 / Tax Liability Insurance

Professional Indemnity 

This is designed to protect you against the cost of settling or defending a client's claim that there is a problem with the work that you have carried out.

Make sure you understand the risk of your business (what can go wrong short and long term). Your insurance should cover negligence, intellectual property infringement, defamation and breach of confidence.

Most of the agencies and employers ask for Professional Indemnity cover before you sign the contract so you need to understand the requirements in detail.

• The scale of your clients and the projects/ programmes you work on. 
• What are the potential legal cost?
• What is the maximum compensation you going to get?

Public Liability Insurance

Public liability insurance can provide essential protection to your business if you deal with the public, have clients visiting your office or if you or an employee needs to visit other premises. If you do not have any visitors coming to your business premises you may still suffer a public liability claim, ie if you accidentally damage a client’s property at their office.

Employee Liability Insurance

It is a legal requirement for most businesses with employees in the UK to have employer’s liability cover of at least £5 million. This insurance policy could pay your legal and compensation costs if you are sued by an employee and if they believe their work has caused them injury or illness. It will cover any person working for your business even if they are volunteers or are self-employed.

Office/ Small Business Insurance

Office insurance is designed to meet the specific needs of those that work from home or run home-based small businesses. It covers such things as portable equipment, business interruption, equipment breakdown and buildings.

Personal Accident Insurance

If you or a key member of your staff suffers from an injury from an accident that has left them unable to work, personal accident insurance cover may pay your business a weekly amount. In the case the injury results in permanent disability or death, your business could receive a lump sum payment.

You may also need personal accident insurance if you have concerns as to how the business would continue if you were unable to work, want to protect your business income or need to honour your business commitments should the worst happen.

Cyber Attack Insurance 

You need to consider this insurance if your business has a risk of a cyber-attack to your computer systems. The insurance should cover, simplicity, reputation protection and a trusted partner in the event of a claim. 

IR35/ Tax Liability Insurance

This is becoming popular these days due to the uncertainty surrounding the IR35 legislation. There are two types of policy available to contractors that will cover tax and IR35 risks,
Defence only
This will handle the HMRC inquiry and any cost surrounding that.
Comprehensive
This will handle the HMRC inquiry and any cost surrounding to that and also the liabilities if you are subsequently found to be caught by the IR35.

Other optional Insurance for contractors.

Income Protection Insurance

Protect your income in the event of even a minor illness or accident (if your GP advise that you are not fit for work).

Life Insurance for Contractors

This covers your family (lump sum or a monthly amount) in case something happens to you.

Medical Cover

This can be tailored to cover your requirements and provide a private medical cover for your treatments. 

Critical Illness Insurance

Critical illness insurance sometimes packaged into a life cover and addresses any cost from the devastating effects of the serious illness.

Jury Service Insurance

Yes, there is an insurance for Jury service and covers up to £500 per day.

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