Business Insurance

The three most common insurances held by contractors are:

• Professional Indemnity – this covers legal costs and expenses incurred in your defence, as well as any damages or costs that may be awarded, if you are alleged to have provided inadequate advice or services that cause your end client to lose money.
• Public Liability – this covers the cost of claims made by members of the public for incidents that occur in connection with your business activities.
• Employers Liability – this enables you to meet the cost of compensation for your employees’ work related injuries or illness whether they are caused on or off site.

Dependent on their personal needs, freelance contractors may also like to consider additional policies such as health insurance, personal accident and income protection cover.

The only insurance required by law is Employers Liability but there is a specific exclusion to this rule if the contractor is only director/employee of their own PSC.

If there is more than one worker in a business (i.e. if the contractor employed their spouse) then Employers Liability will need to be in place.

This will depend on your contract and the actual services you carry out but most contractors commonly hold the following:

Professional Indemnity – £1,000,000

Public Liability – £1,000,000

Employers Liability – £10,000,000

There are many compelling reasons why contractors should purchase business insurance, these include

• The vast majority of recruitment agencies and their end clients will now demand that insurance is held as part of a Contract for Service.
• When operating outside of IR35 legislation, the procurement of insurance is a cost/overhead to the business and it is a powerful indicator of being conventionally in business on your own account.
• Peace of mind in the event that a claim was ever made against your business.

Champion Insurance Brokers (part of the Champion Group) can support contractors with all their insurance needs. Champion policies are underwritten by RSA and premiums can be paid in monthly instalments.

A basic insurance package includes the following:

There are options to increase the limits of cover and to add bespoke insurances & benefits such as:

• Professional Indemnity
• Portable Equipment (e.g. laptops)
• Personal Accident
• Sickness
• Business Travel
• Commercial Legal Expenses
• Provision of a Health and Safety Policy

Note – Champion clients benefit from a 20% discount on all insurance quotes.