Why insurance should be a critical part of your risk strategy

Obtaining appropriate insurance policies is one of the key measures to managing business risk.

These shouldn’t be viewed as a tick-boxing exercise to comply with regulatory requirements. The insurance coverage and limit should match your business and the risks that you need to mitigate.

To illustrate, a bespoke cyber security insurance may be more relevant to a SaaS provider than a grocery retailer. Note that insurances will not only help to shoulder the cost if things go wrong, they may also be required by your customers. You should also look at your suppliers’ insurances to make sure that they are appropriate to back their obligations and risks.

You should speak to a regulated insurance broker to identify and obtain insurance policies appropriate for your business and liabilities to your customers. While we can’t advise on insurance or what is relevant to your business, the following insurances are market standard and relevant to most businesses that we’ve worked with:

• Public insurance;
• Employers’ liability insurance;
• Professional indemnity insurance (if you provide services);
• Product liability insurance (if you manufacture or provide products);
• Motor insurance;
• Contractors’ liability insurance;
• Environment liability insurance;
• Cyber security insurance;
• Data protection insurance. Note that this is a relatively new area and still developing; and
• Commercial general liability.