Firms Taking a Risk without the Protection of Small Business Insurance

Starting your own small business is as exciting as it is nerve-wracking. Being your own boss is a great opportunity to enjoy the freedom of making key decisions for your firm, but many business owners are opting not to protect themselves with appropriate small business insurance. Being your own boss for the first time is exhilarating, but it can also expose you and your enterprise to a new set of threats.

A recent survey by AXA UK found that only 26% of the small business owners who took part had small business insurance cover in place1. Without the protection of insurance cover, 35% of the business owners surveyed said they would turn to family or friends for assistance if something went wrong and they found themselves in financial difficulty2.

What does business insurance cover?

If you’re running your own business and something goes wrong, the consequences can quickly become costly. Insurance for small businesses comes in a range of product types to cover businesses of any size. As every small business is different, it makes sense to choose a combination of covers that best suits the needs of your particular small business. Our range of covers can be combined to support all types of small businesses, providing  the  peace of mind that comes from having a tailored insurance portfolio.

For example, if you work from home and don’t have any employees, you don’t need to worry about including Employers Liability or Employee Benefits covers in your insurance portfolio. On the other hand, if you operate an online business, you may wish to ensure you have adequate cyber crime protection to safeguard your assets from threats. You can also choose to protect your business with covers such as product liability and professional indemnity insurance.

Insurance for small businesses

When it comes to arranging  insurance for a small business, it can be difficult to estimate the  level of protection you need – especially when you’re still a start-up. The good news is that small business insurance packages are available to provide smaller enterprises with the right level of cover for their needs. By tailoring liability insurance,  you can protect your business with the cover you need now and add to it as your enterprise grows.

If you’re not sure where to start, sit down and make a list of the types of liabilities you think apply to your small business. Think about the products and services your business provides, and how you deliver them. Do you welcome members of the public onto your own commercial premises, or offer professional advice from a home-based office? Make sure you have everything noted down and to hand before arranging your insurance or speaking to an advisor.

The risks of opting against small business insurance

Once you’re a business owner, you are legally obliged to have certain insurance cover in place e.g., Employers Liability and Motor Insurance, as appropriate. Arranging  a policy to cover your specific needs means you, and your livelihood, can be protected in the event that something should unfortunately go wrong.

A decision to forgo insurance for your small business could result in you being at financial risk should you be subject to theft, property damage or the target of a cyber-attack. When working with the public, even something as simple as a trip or fall in your business space could result in a costly legal claim. Without public liability cover, you’ll need to self-fund a defence.

Before starting your own business, take some time to speak to one of our specialist advisors to gauge the best level of cover for your needs, or browse business insurance products from Towergate Insurance.

For more information or for a full review of your insurance needs, please see our insurance specialisms, contact your usual Towergate Insurance Brokers adviser or email


1: Very few small firms have business cover in place

2: Very few small firms have business cover in place 

About the author

Mark Brannon Cert CII is a respected industry leader with over 17 years’ industry experience in a variety of roles within the business insurance sector. He works across a wide spectrum of insurance product and policy development, delivery and optimisation for clients, including claims, insurer relationships, marketing and communications, and risk management.

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For more information or for a full review of your insurance needs, please see our insurance specialisms, contact your usual Towergate Insurance Brokers adviser or email

This is a marketing article by Towergate Insurance. The information contained in this communication is based on sources that we believe are reliable and should be understood as general risk management and insurance information only. It is not intended to be taken as advice with respect to any specific or individual situation and cannot be relied upon as such.