How much does Business Insurance Cost in the UK?

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Insurance is a cost that most businesses resent paying, although if they need to make a claim, they often suddenly decide that rather than being a cost, insurance is actually a sensible investment.

One of the most popular ways businesses can protect themselves against unforeseen circumstances is by seeking liability insurance, which refers to any type of insurance policy that protects a person or business against a risk for which they may be sued – public liability insurance is a popular example of this.

So, how much does business insurance cost in the UK, and how can you reduce that cost?

Business Insurance Cost

When an insurer is calculating the price for your insurance cover, they will consider a number of factors including:

  • The likelihood that you will make a claim
  • The likely amount of any claim(s) that you make
  • Their administrative costs
  • Their profit margin

Clearly, there’s very little that you can do to reduce an insurance company’s administrative costs or the profit margin that they choose to work to, but your insurance broker will be able to shop around to find an insurer that keeps their administrative costs down and is happy to settle for a lower profit margin. This will result in lower insurance costs.

You can, however, do things that will affect the likelihood that you will have to make a claim and do things to reduce the potential size of any claim(s) that you might have to make. This will also result in lower insurance costs.


Reducing the likelihood of an insurance claim

There are many things that you can do to reduce the likelihood that you will make a claim. The most obvious is not buying insurance, although that would leave you uninsured in the event of a loss.

However, you can also do things that make your business safer. This could include:

  • Doing risk assessments
  • Getting any relevant training
  • Improving the security at your business premises


Reducing the potential costs of any insurance claims

It would be unwise to reduce the sums insured in your property insurance policy to save money on your insurance costs because if you are underinsured in the event of a property insurance claim, you will be penalised.

It would also be unwise to select too low an indemnity limit in your liability insurance policy. Aside from the fact that you could be underinsured in the event of a compensation claim being made against you, sometimes you are contractually required to have a certain limit.

However, in the same way that you can reduce the chance of a loss occurring, you can take steps to minimise the potential impact of a loss.


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*This indicative price is for £1m public and products liability, £250,000 legal expenses, £10,000 financial loss and £10,000 accidental death insurance cover for a sole trader. The price includes insurance premium tax and our admin charge. 22% of new customers paid less than £58 between 1st January 2019 and 31st August 2019. The actual price you pay will depend upon your specific business requirements and will be affected by your trade, your claims history and the optional covers you select which are all priced separately during the quote process. This website is intended for customers based in the UK and is therefore subject to the UK regulatory regime(s) © Copyright 2019 Tradesman Saver | Tradesman Saver and Henry Seymour & Co. are trading names of Barkdene Limited which is authorised and regulated by the Financial Conduct Authority (FRN 303965) for our insurance distribution and credit broking activities. Barkdene Limited is a credit broker not a lender. You can check this on the Financial Services register
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