Like anything these days, you get what you pay for. The cost of sole trader insurance can vary depending on what type of cover you have in pace, what your indemnity limits are and what optional extras you decide to go for. As a sole trader, you’ll want to keep business costs tight to get the most out of your profits, as cutting corners on insurance can store up problems for later on.
Of course, there are certain features which any sole trader insurance policy should not be without.
Can be a lifesaver for any business, particularly a small sole trader operation. Public liability will cover you for claims made against you by a customer or member of the public should they be injured or suffer damage to their property as a result of your work. This can help protect your business from costly claims which could otherwise cripple it. Annual public liability cover can cost around £50.
Professional indemnity insurance
This covers you for claims of professional negligence made against you. This can range from poorly administered advice to bad workmanship. If a customer can prove they have suffered some sort of loss as a result of following your advice or the work you have carried out, they may seek compensation. Professional indemnity is designed to help you contest such claims and pat out any compensation where it is awarded. Many public liability policies for sole traders included professional indemnity cover, but in other cases, it can come at an added cost.
Many sole trader operations can be pretty small, but even if you only employ one person, you’re required by law to have employer’s liability insurance. How much you pay for employer’s liability will depend on how many people you have working for you, the type of work they do and how much they earn. Whatever the cost of employer’s liability is, it’s minuscule compared to the cost of not having it. Companies can be fined up to £2500 a day if they don’t have employer’s liability cover.
A number of other factors can affect the cost of your sole trader insurance policy. Although not essential, you may want to consider buildings and contents cover for your business premises, as well as cover for stock and office equipment. Any vehicles you use for your business may also require additional insurance as they may not be covered by your standard car or van insurance.
The best way to get an accurate cost of your sole trader insurance is to get a tailored quote which reflects your business.