SME

D&O and MLP: What’s The Difference?
D&O and MLP: What’s The Difference? 500 334 James Hallam

What is the difference between directors and officers (D&O) insurance, and a management liability policy (MLP)? Each can provide some cover for a company’s upper management and decision makers. But is there any overlap between the two? And which type of cover is right for your business?

What is Directors and Officers (D&O) insurance?

D&O insurance provides cover for your business’s directors and officers in the event of legal claims made directly against them. If someone alleges that one of your decision-makers has acted wrongfully while managing the company, a D&O policy can cover their legal fees, along with any settlements or compensation that may be due following the claim.

Such claims could come from regulators, shareholders, creditors, competitors, or even from current or former employees. Plus, directors and officers may be held liable for a number of risks, including cybersecurity, data breaches, and losses arising from mergers, acquisitions, insolvency, and bankruptcy.

With this in mind, D&O insurance can act as an essential safety net, allowing your upper management to make key business decisions with confidence.

Read our full guide to D&O insurance, and why your business may need it.

What is a Management Liability Policy (MLP)?

MLP can include a form of D&O cover, along with cover for corporate legal liability, and for employment practice liability. The D&O cover can cover your upper management for allegations of breach of trust, defamation, insider trading, negligence, and other types of wrongdoing. Beyond this, MLP can provide additional cover for legal claims following alleged breaches of health and safety law, unfair dismissal, discrimination, harassment, pay inequality, employment contract breaches, and more.

MLP can also cover the costs associated with legal claims made against your company and its directors.

What’s the difference between D&O insurance and an MLP?

Compared with D&O insurance, MLP offers much broader and more comprehensive cover.

In short, while D&O insurance will only cover your directors and officers for alleged wrongdoing, MLP provides additional cover for individual employees, and for the company as a whole.

D&O or MLP: What sort of cover does your business need?

D&O and MLP – is it a case of either/or, or does your business need both types of cover?

As many management liability insurance policies include some level of D&O cover, it might seem as though all businesses can get away with getting an MLP to cover all risks. However, a dedicated D&O policy can provide some tailored cover that may be beyond the scope of an MLP.

It all depends on the size and structure of your company. If you are running an SME, then the comprehensive cover provided by an MLP could indeed tick all of your boxes. Yet if your company is structured in such a way that your decision makers could be personally liable for claims of negligence and wrongdoing, you may also need the specialist, focused cover provided by a dedicated D&O policy.

Get help deciding what cover your business needs

If you cannot decide which form of cover is right for your business, or if you are having difficulty understanding the difference between D&O and MLP, talk to us.

We are an independent Lloyd’s broker, and since 1982 we have been helping businesses of all sizes get the cover they need at the best price. We will take the time to get to know your business, and the risks you are facing, so that we can advise you on your unique insurance requirements.

Get in touch for a free quote today.

8 Reasons Why Your SME Needs Cyber Insurance
8 Reasons Why Your SME Needs Cyber Insurance 500 334 James Hallam

Cyber insurance is tailored cover for the risks associated with cyber breaches and other forms of cybercrime. A cyber insurance policy can cover for the costs related to data recovery, legal fees, customer notification, and public relations efforts. It can also provide some cover for business interruption, allowing you to manage your overheads while you deal with the issue.

Read our full guide to what cyber insurance is, and what it covers.

Too many SMEs seem to think that cyber insurance is a niche product that is only necessary if you operate in certain industries. Yet all businesses, regardless of their size or sector, should consider cyber insurance. In this post, we will list eight reasons why.

1: Cybercriminals actively target small businesses

Think your business is “too small” to be of interest to cybercriminals? Think again.

Cybercriminals will not overlook your business because of its size.

One study found that cybercriminals are three times more likely to target SMEs over larger businesses. Another suggested that around 96% of all cyberattacks target SMEs.

2: Many SMEs are powerless to resist cyber attacks

One reason why cybercriminals target SMEs is because they know that smaller businesses are less likely to have robust cybersecurity systems in place. This means that, if they target you with a ransomware attack, for example, you will have no choice but to pay.

3: Cyber threats are getting harder to spot

Phishing is a very common form of cyberattack in which cybercriminals send a fraudulent email that claims to be from a trusted source. This could be a bank, a shopping platform, a manager, or a colleague.

Phishing messages trick the individual into sharing sensitive information, such as login details. This can give cybercriminals access to your systems while leaving you vulnerable to other forms of cyberattack.

Fake phishing messages are getting increasingly difficult to spot. There’s a growing threat of cyber criminals using AI modules to create phishing emails that are so realistic that they could fool even the most seasoned of cybersecurity expert.

4: Cybercrime carries a huge cost

The UK government’s cyber security survey found that, for UK businesses, the average cost of a single security breach was between £1,100 and £4,960. Would your business be able to bounce back from such an expense?

5: Cybercrime is getting more expensive

IBM recently surveyed 604 organisations and 3,556 cybersecurity and business leaders who had been hit by a data breach. They found that the global average cost of a data breach in 2024 was $4.88m. This is the highest it’s ever been, and it represents a 10% increase over the previous year’s figures.

6: A cyberbreach will cost you more than you might think

Following a cyberbreach, your business will take a significant financial hit. But the blow to your reputation could be much more damaging.

How many current and potential customers would you lose if you create the impression that you cannot be trusted to handle sensitive customer information?

And what if, in the investigations following the cyber breach, it is found that your business did not do enough to secure your customers’ sensitive data? This could imply you are in breach of GDPR, which could carry further fines.

7: Businesses can feel the impact of a cyberattack for years following the breach

A 2023 government survey found that 88% of businesses hit by a cyberattack were able to restore their operations within 24 hours of the attack. A separate study found that the average amount of downtime following a cyberattack was 24 days.

Yet some cyberattacks are so severe that recovery takes years. The Scottish Environment Protection Agency was hit by a ransomware attack in December 2020. As of February 2024, they were still rebuilding their systems.

Plus, it might be rare, but it does happen – sometimes a cyberattack is so severe that it sinks a business completely.

8: Cyber insurance can determine how effectively your business recovers from the attack

The amount of time it takes your business to recover from a data breach will depend on the severity of the attack, along with how effectively you can respond.

While cyber insurance will not protect your business from cyberattacks, it will at least ensure that you will have the means in place to respond to a breach.

With cyber insurance, you can get comprehensive cover for the costs related to data recovery, legal fees, customer notification, and public relations efforts. A cyber insurance policy can also provide some cover for business interruption, allowing you to manage your overheads while you deal with the issue.

Without a cyber insurance policy, a data breach could ruin you. But get the cover you need today, and you will have peace of mind that you will be able to bounce back from even the most severe of breaches.

Get tailored cyber insurance for your SME

James Hallam is an independent Lloyd’s broker with access to a hand-picked selection of A-rated insurance providers. We can help you find the cyber insurance you need at the best possible price.

Get in touch for a free quote today.

Do Hotels Need Cyber Insurance?
Do Hotels Need Cyber Insurance? 800 564 James Hallam

If you run a hotel, then you know you need to get certain forms of insurance to cover your establishment against risks such as fire, flood, and theft. But does your hotel need cyber insurance? Is your hotel really so vulnerable to cybercrime that you need specialist insurance to cover you against the risks?

Short answer: Yes. Your hotel absolutely does need cyber insurance. In this post we will explain why.

What are the cyber security threats for hotels?

Phishing attacks

A phishing attack involves sending a message, usually via email, which appears to come from a trusted source, such as a manager, a colleague, a bank, or an online retailer. These fake messages can trick employees into providing sensitive information, such as login details. This can give cybercriminals access to your system, which can leave you vulnerable to other types of cyber-attacks.

Ransomware attacks

With a ransomware attack, cybercriminals can encrypt your files remotely. You will be unable to access your online system until you pay a ransom. If you fail to make this ransom payment, the cybercriminals might simply delete your data, or they might choose to sell it to other cybercriminals. This will put you and your guests at significant risk of further financial exploitation.

Data breaches

If cybercriminals gain access to your system, they may simply choose to steal your data outright. This could result in significant financial and reputational losses for your hotel, while leaving your guests vulnerable to identity theft and financial exploitation.

Why do cybercriminals target hotels?

There are a few reasons why cybercriminals might choose to target hotels.

Your hotel is unlikely to have sophisticated cybersecurity measures in place, and it is unlikely that you have trained your staff to recognise the risks of phishing emails, and other forms of attack. This means that it would be easier for cybercriminals to access your system. It also means that you will not be able to adequately respond to a cyberattack.

Also, hotels tend to store a lot of sensitive data on their systems, including guests’ personal details, and even their credit card numbers. This sort of data can be immensely valuable for cybercriminals.

Finally, hotels tend to offer cybercriminals multiple points of attack. From your online booking systems to the devices you use to check in your guests, cybercriminals will have a choice of vulnerabilities to test and exploit so as to gain entry to your system.

How can cyber insurance protect your hotel?

Investing in staff training and cybersecurity can protect your business from cybercrime. But while such investments offer strong prevention, cyber insurance provides a reliable cure.

In the event of a cyberattack, cyber insurance can provide cover for customer data loss, for system breaches, and for any legal fees you might face following the incident. In this way, cyber insurance is crucial for helping your business and your guests recover from the devastating effects of a data breach.

At James Hallam, we can provide you with comprehensive cyber insurance cover as part of a wider travel and tourism insurance package.

Find out more about our cyber insurance for businesses as well as our comprehensive insurance policies for travel agents and tour operators.

For more information, call us on 0330 024 0755 or email enterprisenb@JamesHallam.co.uk.

Commercial Combined vs. Separate Insurance Policies: Which is Best For Your Business?
Commercial Combined vs. Separate Insurance Policies: Which is Best For Your Business? 800 534 James Hallam

If you run a business of any size, then you will need adequate business insurance to cover you for the various risks you will face.

When it comes to business insurance, you have a choice. You can either get separate insurance policies to cover you for each individual risk you face, or you can get commercial combined insurance to cover you for a range of risks with a single policy.

In this post we will outline the pros and cons of commercial combined insurance, to help you decide which approach is best for your business.

What is a Commercial Combined Insurance policy?

In short, a commercial combined insurance policy will give your business various different types of cover in a single policy. So, rather than getting separate policies for your buildings cover, your business interruption cover, your cyber cover, and so on, you can get a single combined policy to cover your business for a range of risks.

Read our full guide to commercial combined insurance. Our guide outlines how a commercial combined insurance policy works, and what it covers.

Advantages of Commercial Combined insurance

The biggest benefit of a commercial combined insurance policy is the convenience. If you take out a single combined policy to cover your business for a range of risks, then there will be no need to shop around for separate policies. Plus, if you ever need to make a claim on your policy, there will only be a single number to call, and a single claims process to manage.

Commercial combined insurance policies can also be a lot more cost-effective than separate insurance policies. Some insurers offer discounts if you choose a combined policy instead of numerous separate policies. On top of this, if you have multiple policies, there may be certain overlaps in your cover. This could mean that you will end up paying more than necessary for your insurance.

Disadvantages of Commercial Combined insurance

While most insurers will tailor your combined insurance policy to meet your exact cover requirements, there may still be some gaps in your cover. Check your policy wording carefully, including the cover limits, to ensure you are not at risk of underinsurance.

Also, commercial combined insurance policies may not include specialist cover for risks that are unique to certain industries. For example, businesses operating in the healthcare sector are unlikely to have all of their needs met by a commercial combined insurance policy.

Finally, while commercial combined insurance can be a more cost-effective choice than getting multiple different policies, you must not assume that you will automatically make savings through choosing a combined policy. Be sure to compare quotes and prices. And though it will be a less straightforward option, it just may prove more affordable to invest in a number of individual policies for your business.

Commercial Combined vs. separate insurance policies: which is best for your business?

Commercial combined insurance is a great choice for certain types of businesses. If you are a large business facing numerous risks, then it may prove too inconvenient and expensive to take out separate policies for every aspect of your business. SMEs, too, might value the peace of mind that comes with taking out a single policy to cover a range of risks.

However, some SMEs might not need some of the cover offered by a comprehensive commercial combined insurance policy. If a combined policy is surplus to requirements, it might prove more cost-effective to instead take out a handful of separate policies. This is something an insurance broker like us can help you with.

Additional specialist insurance on top of commercial combined policy

If you operate in certain industries – such as healthcare – then you may need to take out additional separate policies on top of your commercial combined insurance policy, to ensure you have all of the cover you need.

Should I choose commercial combined insurance for my business?

James Hallam is an independent Lloyd’s broker with access to a hand-picked selection of A-rated insurance providers. Talk to us about your business and your insurance requirements, and we can help you find the cover you need at the best possible price – whether this is through a combined commercial insurance policy, or through a number of individual policies.

Get in touch for a free quote today.

mobile catering van

What Insurance Do I Need For a Mobile Catering Van?
What Insurance Do I Need For a Mobile Catering Van? 700 467 James Hallam

All catering businesses need some form of insurance cover. But if you run a mobile catering van, a food truck, or an ice cream van, you will face certain additional risks that fixed-site cafés and restaurants will not have to worry about.

In this post we will explore the insurance you will need to consider for a mobile catering van, to make sure you are covered for all possible risks and liabilities.

What risks do catering businesses face?

There are many risks associated with preparing and serving food to members of the public. Any catering business will need cover for any accidents, injuries, and illnesses customers may sustain as a result of interacting with your business, including food poisoning and allergic reactions.

Specific risks catering vans face

If you have a catering van business, though, you will face additional risks that you would not face if you were running a fixed site café or restaurant. As well as cover for your equipment, you will also need specialist commercial vehicle insurance to cover your catering van. On top of this, the cover you get for your stock will have to extend to provide cover for transit.

Plus, your insurer will have to consider the risks associated with serving different customers in different locations from one week to the next. For example, what if you accidentally hit a child’s head when you’re opening your serving hatch?

Beyond all of these risks, mobile catering vans will have to manage the sort of risks that face any business in any sector, including fires, floods, theft, business interruption, personal injury, and so on.

What insurance do I need for a mobile catering van?

  • Public Liability Insurance – This can cover most accidents, injuries, and illnesses members of the public may sustain as a result of interacting with your business, along with any damage you may cause to public property.
  • Product Liability Insurance – If a customer ever gets food poisoning, or suffers an allergic reaction, as a result of consuming food you serve, product liability insurance can cover any compensation they may be due, along with any legal fees you may have to pay.
  • Commercial Vehicle Insurance – You will need comprehensive cover for your vehicle. This will cover any repairs your vehicle may need following an accident, as well as any repairs that may be necessary for any other vehicles or property involved in an accident.
  • Contents Insurance – Cover for your cooking equipment and furnishings, along with your stock. If you have a catering can, the cover you get for your stock will also have to cover it for loss, damage, or spoiling during transit.
  • Employer’s Liability Insurance – If you employ any staff, you have a legal obligation to get employer’s liability insurance. This will cover any compensation an employee may be entitled to if they sustain any illnesses or injuries on the job.

Find out more about our specialist catering insurance and who it covers.

Get specialist catering insurance from James Hallam

James Hallam is an independent Lloyd’s broker with access to a hand-picked selection of A-rated insurance providers.

We know that no two catering businesses are quite the same, and that mobile caterers face a host of additional risks and liabilities. As a result, we will take the time to get to know you, your business, and your customers. In this way, we can design a catering insurance package that truly meets your needs at a competitive price.

Get in touch for a free quote today.

warehouse

What is Commercial Combined Insurance?
What is Commercial Combined Insurance? 600 400 James Hallam

All businesses face a range of risks, including fire, flood, theft, business interruption, cybercrime, and more. You will need adequate insurance to cover your business should anything ever go wrong.

As an alternative to getting separate policies to cover individual risks, many businesses instead choose a commercial combined insurance policy.

In this post we will discuss what a commercial combined insurance policy is, and what it covers, to help you decide whether it is the right choice for you.

What is Commercial Combined insurance?

A commercial combined insurance policy includes various types of business insurance cover in a single policy. Getting a commercial combined insurance policy can be the most convenient choice for many businesses. Rather than taking out multiple policies to cover multiple liabilities, businesses can instead get extensive cover with a combined policy.

What does Commercial Combined Insurance cover?

Most insurers will tailor your commercial combined insurance policy to meet all the risks you face in your business. Most policies will include the following:

  • Buildings Insurance – Cover for damages to your business premises, alongside any machinery, equipment, furnishings, and stock.
  • Cyber Insurance – This can cover any liabilities and expenses you might face if your business falls victim to a cyberattack, or a data breach.
  • Business Interruption Insurance – If you are forced to temporarily cease trading due to a fire, a flood, or another covered event, business interruption insurance can cover your loss of revenue, your increased costs of working, and other specified expenses.
  • Public Liability Insurance – If a member of the public gets injured on your premises, or if you damage public property while conducting business, public liability insurance can cover any legal costs you may be liable to pay.
  • Employer’s Liability Insurance – All businesses have a legal duty to get employer’s liability insurance if they employ any staff. It covers any compensation an employee may be entitled to if they sustain any illnesses or injuries on the job.
  • Product Liability Insurance – If you manufacture and distribute products as part of your business, product liability insurance will cover you for any loss, illness, or other damages linked to your products.

Find out more about what our Commercial Combined Insurance policies cover and who they’re for.

What are the benefits of Commercial Combined insurance?

Having a commercial combined insurance policy over separate policies can be beneficial for a number of reasons, including being:

  • Convenient – With a commercial combined insurance policy, there is no need to shop around for multiple policies to cover every aspect of your business. Plus, if you ever need to make a claim on your policy, you will only ever have to make one call, which can streamline the process.
  • Cost-Effective – Some insurers offer discounts if you buy a combined commercial insurance policy in place of multiple policies. Plus, if you have multiple policies, there may be overlaps in your cover. This might mean you end up paying more for insurance you do not really need.
  • Comprehensive – Get all the cover you need in one policy, and you will not need to worry about underinsurance, or in any gaps in your cover. Plus, most insurers will tailor your commercial combined insurance policy to ensure it meets your exact needs, including your budget needs.

We can help you get all the cover you need at the best price

James Hallam is an independent Lloyd’s broker with access to a hand-picked selection of A-rated insurance providers.

If you want to get all of your cover needs met by a combined commercial insurance policy, we can help you ensure your policy ticks all of your boxes at a truly competitive price.

Get in touch to get a free quote today.

directors

10 Reasons Why Your Business Needs Directors & Officers (D&O) Insurance
10 Reasons Why Your Business Needs Directors & Officers (D&O) Insurance 750 422 James Hallam

What is Directors and Officers insurance?

Directors and Officers (D&O) insurance is a vital safeguard for businesses, protecting key decision-makers from personal liability in the event of legal claims related to their roles. In the UK, the responsibilities of directors and officers have increased significantly due to ever-evolving corporate governance standards and stricter regulations. Without D&O insurance, your business and its leaders may be exposed to serious financial and legal risks.

What Does D&O Insurance Cover?

D&O insurance provides essential protection, covering legal defence costs, settlements, and compensation in a wide range of scenarios. Ultimately, D&O insurance is not just a safety net—it’s a vital tool for protecting the individuals who make the critical decisions that drive your business forward. By investing in a D&O policy, you safeguard your leadership team, your business, and your future.

Who Needs D&O Insurance?

Whether your business is a start-up, an established corporation, or a non-profit, having the right D&O policy in place can help you attract top talent, navigate regulatory challenges, and focus on growth without fear of personal liability.

Here are ten compelling reasons why every UK business should consider D&O insurance.

  1. Protect your Business from Personal Liability

The primary reason to invest in D&O insurance is to shield directors and officers from personal liability. In the UK, if a director or officer is accused of wrongful acts such as breach of duty, mismanagement, or negligence, they can be personally sued. Unlike the business itself, which may have its own insurance, individuals in these roles are vulnerable to legal claims that could threaten their personal finances. D&O insurance provides protection by covering the legal costs and damages, ensuring that directors and officers aren’t held personally responsible for costs related to decisions made in good faith.

  1. Defence Against Claims by Employees

Employees can file claims against directors and officers for a variety of reasons, including unfair dismissal, harassment, discrimination, and breach of employment contract. Such cases can be highly damaging, both financially and reputationally. Even if a claim is unfounded, the legal fees alone can be substantial. D&O insurance covers legal defence costs, settlements, and compensation in employee-related disputes, protecting your leadership team from potentially crippling financial burdens.

  1. Regulatory Investigations and Fines

The UK has strict regulatory bodies, including the Financial Conduct Authority (FCA) and the Health and Safety Executive (HSE), which hold businesses and their leaders to high standards. Regulatory investigations can be complex, time-consuming, and expensive. If your business or its directors are accused of breaching regulations, D&O insurance can cover legal expenses and fines associated with regulatory investigations, reducing the financial strain on your business.

  1. Investor and Shareholder Lawsuits

Shareholders or investors may file lawsuits against directors and officers if they believe mismanagement has led to financial loss or a decline in the value of their shares. In the UK, these types of claims are becoming more common, particularly for public companies. A D&O policy covers legal defence and any potential settlements, ensuring that the personal finances of directors and officers are protected while enabling the company to manage the situation effectively.

  1. Mergers and Acquisitions (M&A) Risk

Mergers and acquisitions can be exciting growth opportunities for businesses, but they also bring significant legal risks. During an M&A process, decisions made by directors and officers are often scrutinised by shareholders, regulators, and even the media. If stakeholders feel that they were misled or that the deal wasn’t in their best interests, lawsuits can follow. D&O insurance is essential for protecting directors and officers involved in these high-stakes decisions, ensuring they’re covered in the event of legal disputes during or after the transaction.

  1. Cybersecurity and Data Breach Liability

With the rise of cybercrime and the increasing importance of data protection regulations like the UK’s Data Protection Act 2018 (which incorporates the principles of GDPR), directors and officers are increasingly being held accountable for cybersecurity failures. If your business suffers a data breach, directors could be personally sued for failing to implement adequate safeguards. D&O insurance can cover legal costs associated with such claims, helping to mitigate the financial fallout from a data breach.

  1. Insolvency and Bankruptcy Claims

If a business becomes insolvent or bankrupt, directors may be personally liable for claims of wrongful trading or mismanagement leading up to the financial collapse. In the UK, wrongful trading occurs when directors allow a company to continue operating while knowing it is insolvent. D&O insurance offers crucial protection by covering legal costs and potential damages arising from such claims, helping directors navigate the challenging process of insolvency without putting their personal assets at risk.

  1. Attract and Retain Top Talent

Top talent is often drawn to businesses that offer robust protection for their leaders. By providing D&O insurance, your business can demonstrate its commitment to safeguarding directors and officers from personal risk. This level of protection can be a key factor in attracting experienced professionals to your leadership team. Additionally, offering D&O insurance can help retain top talent by giving directors and officers peace of mind that they are protected in the event of a legal claim or regulatory investigation.

  1. Protection for Non-Profit Organisations

D&O insurance isn’t just for large corporations; it’s also crucial for non-profit organisations, charities, and community groups. While these organisations may not have the same level of financial exposure as big businesses, directors and officers are still responsible for managing the organisation’s finances, governance, and regulatory compliance. Without D&O insurance, directors and officers of non-profits are at risk of personal liability if they are accused of mismanagement or negligence. This protection is especially important given the limited financial resources many non-profits have at their disposal to cover legal costs.

  1. Claims Can Arise Even After Resignation

One often-overlooked benefit of D&O insurance is its ability to provide cover for claims that arise after a director or officer has resigned from their position. Legal actions can be filed long after an individual has stepped down, particularly if there are allegations of wrongful acts committed during their tenure. D&O insurance ensures that former directors and officers remain protected, giving them the confidence to make decisions without fear of lingering liability.

Why is Directors and Offices Insurance so Important?

In today’s complex business environment, the risks faced by directors and officers are higher than ever. From regulatory scrutiny and employee claims to cyberattacks and shareholder lawsuits, the potential for legal action is vast. Without D&O insurance, directors and officers are left exposed to personal liability, putting their financial security on the line for decisions made in the course of their duties.

What’s the Difference Between D&O Insurance and Management Liability Insurance?

In the UK, Directors and Officers (D&O) insurance and Management Liability Insurance (MLI) are similar but differ in scope. As detailed above, D&O insurance protects directors and officers against personal liability for claims made against them while performing their duties. In contrast, MLI is broader, covering not only directors and officers but also the company and senior management. It includes risks like employment practices liability (e.g., discrimination or wrongful termination). While D&O focuses on individual liability, MLI covers both individuals and the business entity against management-related risks. 

Talk to Us About D&O Insurance Today

Get in touch for a free quote today.

small business

How Much Does Small Business Insurance Cost?
How Much Does Small Business Insurance Cost? 900 507 James Hallam

In this post we will discuss how much small business insurance costs in 2024. We will explore some of the factors that affect the cost of cover, along with some strategies for reducing your premiums.

Is Business Insurance Getting More Expensive?

A recent report by the Federation of Small Businesses revealed that around 60% of small businesses had seen their insurance premiums rise in the past year. What’s more, 52% of these businesses have seen a rise of 11% or more.

There are many reasons for the rising costs of small business insurance. Enforced government lockdowns during the pandemic forced many small businesses to make business interruption claims, which may have raised the cost of cover for all. Plus, the UK’s been hit by soaring inflation in recent years, which for many will have made a difficult situation even worse.

What Can Affect The Price of Small Business Insurance?

A number of things can affect the price of your small business insurance:

  • The size of your business. Generally speaking, the larger your workforce, the more you’ll pay for cover. However, insurers sometimes offer group insurance policies to cover employees who face similar risk profiles, which means that some larger businesses may be able to get a discount on their cover.
  • The industry you work in. Businesses in certain industries face different risks than others. For example, builders and architects may have to pay more for cover than, say, marketing agencies, as the risks associated with their work are much higher.
  • The people you’re covering. Different members of your team will face different risks, too. For instance, it will probably cost more to cover warehouse staff than office staff, as warehouse staff face a higher risk of injury.
  • The area you operate in. Businesses based in London and other major cities may have to pay more for cover than businesses located in less populous areas.
  • Your claims history. Unfortunately, if your business has ever made a claim on your policy, it can raise the cost of your premiums. It largely depends on the frequency of the claims, and the severity.

How Much Does Small Business Insurance Cost – Rough Estimates

The cost of cover can vary greatly from business to business. Market conditions can also affect the price of premiums. So, please treat the following as rough estimates only. For a more accurate idea of how much you should expect to pay for small business insurance, get in touch for a free quote.

All of our figures are based on the averages provided by the finance and lending research and information specialists at Business Financing.

  • Public Liability – On average, small businesses pay £118 a year for public liability cover. Yet depending on the business, the actual premiums can be as little as £50 a year, or as much as £5,000 a year.
  • Professional Indemnity – Small businesses can pay as little as £115 a year for their professional indemnity cover. However, Business Financing reports that businesses working in certain high-risk industries may need to pay up to 10x more.
  • Employer’s Liability – As we mentioned above, it will cost a different amount to cover different employees based on the work they do. For desk-based workers, you might expect to pay £60 per year for employer’s liability. Yet for any employee who does physical labour, this can rise to over £200 a year.

These are just three of the most common insurance products that small businesses might need. The more cover you get, the more you will need to pay. See the full cover available through James Hallam.

How to Reduce The Cost of Small Business Insurance

When it comes to insurance, your priority should be to get the cover you need, and not to make your premiums as low as possible. But there are a few things you can do to reduce the cost of your business cover:

  • Pay annually, rather than monthly. Some insurers offer small discounts if you pay for your cover in an annual lump sum, rather than in monthly payments.
  • Choose a different level of cover. You have a legal requirement to get some forms of cover, such as employer’s liability insurance. Beyond your regulatory obligations, the amount of cover you get is entirely up to you.
  • Pay a higher excess. Offer to pay a higher excess in the event of a claim, and you can reduce your monthly premiums.

However, there are serious risks associated with each of these money-saving strategies. Paying annually for your insurance can lead to cashflow issues. Intentionally choosing less cover can leave you vulnerable to underinsurance. Paying a higher excess could lead to trouble if you ever need to make a claim on your policy, as it will mean that your settlement could be less than you need.

Talk To James Hallam About Your Small Business Insurance Needs

James Hallam is an independent Lloyd’s broker with a dedicated team of experienced insurance professionals who are committed to getting you the cover you need at a price you can afford.

Talk to us, and we can help you ensure you have enough cover to protect your business, at a fair price. We will take the time to understand your risks so we can tailor a flexible SME insurance package that offers full cover at outstanding value.

Get in touch for a free quote today.

Cyber & Data Risks Insurance
Cyber & Data Risks Insurance 1920 1280 James Hallam

Each year when completing a review of their insurances, most businesses will look at uninsured exposures with their insurance broker. Most of these can be reasonably ignored following simple cost-benefit analysis, but cyber is more difficult in that the associated risks and their potential cost to a business are still developing. It is anticipated though that the frequency and severity of such incidents will continue to rise, mirroring the experience of North America where cyber risks are given a higher regulatory and boardroom prominence. In the US it is now estimated that over 75% of corporate businesses purchase cyber insurance.

  • Different businesses will be exposed to cyber risk in different ways; some are reliant on their website to drive turnover, some rely on a hosted accounting or billing system to operate whilst others hold sensitive client data or intellectually valuable data on their systems. There are a multitude of scenarios that leave a business exposed to internal and external electronic threat. The failure of an IT network could be debilitating and a good first step is to identify and take steps to mitigate external and internal IT risks. These include:
    data theft or data loss
  • hijacks where hackers gain control of a system and demand a ransom to restore service
  • bot scams where viruses are used to take over large numbers of computers
  • basic human error (internally generated risks should not be overlooked and continue to be the most common proximate cause to a cyber loss)

Notification costs following the loss of third party data is now a major concern for EU business following GDPR. Safekeeping of data is the responsibility of the customer facing entity, notwithstanding that a third party processing company may have been the party that lost the data and/or contractual terms making a third party responsible for notification. This means if you are hacked and lose your customer data (names, addresses, credit card numbers etc.) you will need to report the loss to the data commissioner, possibly pay PCI fines, pay the cost of notifying your customers that they are at risk, pay for advice to manage their risks and pay PR costs to manage the potential damage to your brand and reputation. All of these risks can be insured and cyber insurance will additionally cover fines and penalties associated with regulatory investigations due to a privacy event.
The other major threat to a business may be the loss of a website and a resultant loss of revenue. Again, this can be insured.

  • The cyber insurance market has been developing at a rapid pace over the past five years as experience has been gained by insurers. Areas of cyber-risk that can now be insured include:
    replacing, restoring or recreating data that has been corrupted or destroyed by network failure or first/third party intervention
  • loss of data and notification management costs
  • criminal threat or extortion to release sensitive information or bring down a network unless demands are met
  • loss of income and extra expenses resulting from when a network is interrupted by attack. Covers criminal hackers, malicious insiders and denial of service (DOS) attacks, (including extortion monies)
  • payment fraud (deception of the insured’s customers into transferring over funds)
  • public relations expenses and crisis management
  • disaster recovery activation costs
  • fines and penalties where insurable by law
  • use of leased / rented external equipment
  • use of third party services
  • additional staff expenditure and overtime payments
  • terrorism risk, including ideological risk (LulzSec, Anonymous etc)

James Hallam Insurance Brokers have been placing cyber risk in the London market for over fifteen years. We source cover to insure against all of the above threats and, in addition, we can protect against risks that the majority of cyber insurers omit. For example, our favoured market will also provide:

  • the provision of first party cover on an “each and every claim” basis, ensuring that policyholders aren’t restricted by a policy aggregate and that the full benefits of cover are available each time a crisis strikes, even if they experience multiple cyber incidents in the same policy period
  • full retroactive cover as standard, meaning that policyholders are covered for breaches they discover during the policy period, even if it first occurred long before. Symantec has reported that the average time to discover a breach is 205 days, making this a particularly important feature
  • an extensive in-house incident response capability to ensure that cyber incidents are dealt with quickly and efficiently in real time. Initial response services are offered with no deductible payable by the insured
  • broader cover for senior executive officers who are regularly targeted in cyber attacks, covering theft of personal funds of individuals as well as those of the company
  • if a suit is brought against directors and officers following a cyber attack, the policy provides affirmative cover in the event that their management liability policy doesn’t respond
  • incident response costs are provided in addition to the policy limit
  • no excess is applied to the initial reporting and investigation costs
  • full systems failure is covered, including resultant business interruption
  • full Supply Chain is covered, including Technology suppliers (and non-Technology suppliers if named)
  • Cryptojacking and Botnetting are included under the definition of Cyber Crime
  • Additional Extra Expense coverage is included for costs above the normal operating expenses of a business
  • Hardware Replacement coverage is included for computer hardware or tangible equipment damaged as a result of a cyber event

Some points to consider when discussing Cyber Risk with your clients

Dealing with a ransomware incident is rarely a simple matter of the ransom payment being made and the business in question automatically regaining access to their systems and data. Even after a ransom payment has been made, and assuming the system can be successfully decrypted, the ransomware can have the unintended side effect of severely impairing the functionality of one or more of a business’s vital systems.

The use of legacy systems can significantly increase the risk of a cyber loss. Generally speaking, legacy systems are not only far more vulnerable to attack, they are also much more susceptible to dysfunction following a cyber attack.

The importance of having data re-creation cover is becoming increasingly apparent. Many cyber policies only provide cover for the cost to recover or restore data from back-ups, but not the costs to re-create or re-enter lost data from scratch. The bulk of the costs to a claim can come from the labour costs associated with manually re-entering data, and brokers should be sure to check that their clients have this important cover in place.

Almost all modern businesses have some form of cyber exposure. Even if a policyholder does not solely rely on their computer systems to carry out work, they will still have an office function that playing a key role in the running of the business. When the computer systems in an office are affected by a cyber event it will almost certainly have a negative impact on the overall business operation and having a cyber insurance policy in place will provide a valuable safety net for the company.

James Hallam can place cyber insurance in the London Market for business domiciled almost anywhere worldwide so please feel free to get in touch if you would like us to assist you and your clients.

Credit Insurance Can Be Essential To Your Business
Credit Insurance Can Be Essential To Your Business 1920 1280 James Hallam

2019 is set for a significant increase in business failures since those following the Global Financial Crisis of 2008.

Insolvencies will occur for reasons not seen before such as stress on cash flow due to stockpiling, delivery delay and failure to recognise the effect of tariff and regulatory changes.

  • All business sectors are likely to see margins and their ability to pay promptly squeezed
  • Several high profile insolvencies have occurred in 2018 and companies in many sectors are issuing profit warnings – even the on line retailer ASOS
  • The Office for National Statistics quarterly release shows insolvency  increases in Q3 2018 of +8.9% sequentially on Q2 and +19.3% on Q3 2017
  • This demonstrates a fragile economy with definite potential for more business failures in 2019

Suppliers of goods and services need up to date financial information to ensure customers are able to pay their invoices and the security of knowing unpaid debt is covered by insurance. Not only does a credit insurance policy provide debt collection and indemnity for non-payment following insolvency or protracted default but also REAL TIME FINANCIAL INTELLIGENCE

A ‘buyer’ of goods and services failing to meet debt obligations or with a weakening financial position will be alerted to credit insurers in advance of information becoming public. This critical data enables a credit insured company to review their exposure with vulnerable customers and minimise potential for bad debt

Credit Insurance offers a solution – let our experts speak to you about the benefits this can bring to your business

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