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What is commercial insurance?

Jake Edmonds
Written by  Jake Edmonds
6 min read
Updated: 27 Jan 2025

Commercial insurance explained 

At its core, commercial insurance is a broad term encompassing various policies designed to protect businesses from risks that could cripple their operations or finances. Often called business insurance, it's a safety net that not only secures a company's monetary health but also its reputation. From the corner shop to the sprawling corporation, commercial insurance is a critical tool for any business seeking longevity and stability in an often unpredictable market. 

A smiling woman and man looking at plans on work site, in hardhats

Types of commercial insurance 

The world of commercial insurance is vast, with policies tailored to the unique demands of each business. Understanding the range of available options is the first step in fortifying your enterprise. 

Public liability insurance 

Public liability insurance is a cornerstone for businesses that interact with customers or the public. Whether you're a restaurant owner, a hairdresser, a tradesperson, or a shopkeeper, it's a policy that can't be overlooked. Sometimes known as ‘commercial liability insurance,’ this insurance is crucial for incidents that occur both on your business premises and off-site, such as a client’s site. However, it's crucial to remember that this insurance is a safeguard for the unexpected and accidental, not a blanket cover for all incidents. For a deeper dive, explore our guide on 'what is public liability insurance?' 

Professional indemnity insurance 

Those in the business of offering advice, particularly on financial or legal matters, should heed the call of professional indemnity insurance. This policy serves as armour against claims of professional misconduct, including the mishandling of confidential information, bad advice, copyright infringement, and the provision of detrimental advice. To grasp the full scope of protection, consider our guide on 'what is professional indemnity insurance?

Employers' liability insurance 

When it comes to your workforce, employers' liability insurance is not just wise—it's often legally required. This policy defends against the financial aftermath should an employee be injured or fall ill due to their work. Be aware that you will need employers’ liability insurance even if you’ve only hired temporary or casual staff.  

Beyond the basics: Specialised commercial insurance 

However, there are certain types of cover, including public liability and professional indemnity, that could apply to most businesses. As well as those mentioned above, there’s a large array of specialist commercial insurance covers that could benefit your business. Here, we detail a few of the most prominent options: 

  • Product liability insurance: This safeguards against claims arising from injuries or damage caused by your business's products, whether you're the designer, manufacturer, supplier, or retailer. 

  • Business contents insurance: This type of policy ensures that your business equipment and furniture are covered for replacement or repair costs. Remember to keep your policy updated with new purchases. 

  • Business buildings insurance: For those who own their premises, this insurance is essential for covering repair or rebuild costs due to events like fire or vandalism. 

  • Property insurance: This cover is broader, securing your building and contents against disasters while helping if business income is affected. 

  • Stock insurance: Vital for businesses reliant on stock; this insurance assists with replacement costs if your inventory is compromised. 

  • Tools insurance: Tradesmen will find this insurance invaluable for protecting their work equipment from loss or damage. 

  • Business interruption insurance: During disruptions, this policy covers lost income, aiding your business in recovery. 

As a business owner, the main thing you want to be focusing on is doing the work you love and providing your services. So making sure you can do that without the danger of a costly claim hanging over your head is vital. When choosing which policies to take out, do your research and shop around to make sure you find a price and a policy which works for you.

Sam Meadows, Personal Finance Expert

Tailoring commercial insurance to your needs 

When selecting the right insurance for your company, take a moment to consider a few factors and how your business operates. For instance, some companies use commercial vehicles for daily operations. Others may have physical premises, stock, equipment, and a direct interaction with the public. Each aspect of your business model may necessitate a different type of insurance, shaping a policy that's as unique as your enterprise. 

Finding the ideal commercial insurance 

If you're on the hunt for commercial insurance, look no further than MoneySuperMarket. Here, you can find and compare quotes tailored to your business's specific needs and budget. By providing details about yourself and your organisation, you'll receive personalised policy options, ensuring you're equipped with the right cover for every business challenge. 

Your business is one of your most valuable assets; protecting it with commercial insurance isn't just prudent—it's essential. With the right cover in place, you can focus on what you do best: growing your business and serving your customers. 

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