Business insurance types quick reference

Guide summary

Employers' liability insurance covers claims from employees injured or made ill at work
You can be fined up to £2,500 for each day you have no employers' liability insurance
You can be fined up to £1,000 if you do not display your employers' liability certificate
Count part-time staff as employees when deciding if you need employers' liability insurance
Driving a business vehicle uninsured is a criminal offence
Check with your professional regulator whether you need professional indemnity insurance, and how much
Clients and landlords often require public liability insurance in contracts; many ask for at least £5 million
Buildings insurance is not required by law, but is recommended if you own business premises

Use this table to identify which insurance types apply to your business. Mandatory insurance is a legal requirement; operating without it is a criminal offence.

Insurance type	Legal status	What it covers	Who needs it	Typical cover level

Business Insurance Types Comparison

Overview comparing different business insurance types and their requirements

The insurance your business needs depends on what it does. Some types are required by law. Some are required by professional regulators. The rest are not required by law, but you may still need them for contracts or to protect your business. Each type below starts with its legal status, so you can see which group it is in.

Employers' Liability: Required by law if you employ anyone, with at least £5 million of cover. Covers claims from employees injured or made ill at work.
Motor Insurance: Required by law for any vehicle used for business on roads or in other public places. Driving uninsured is a criminal offence. Covers claims from accidents in vehicles used for work.
Professional Indemnity: Required by some professional regulators, for example for many solicitors, financial advisers and architects. Covers claims of negligent advice.
Public Liability: Not required by law, but clients and landlords often require it in contracts. Covers claims for injury to other people or damage to their property.
Products Liability: Not required by law, but essential if you make or sell goods. Covers claims from defective products.
Business Contents: Not required by law, but recommended if you have equipment or stock. Covers business assets against theft, fire and damage.
Business Interruption: Not required by law, but recommended if a fire or flood would stop you trading. Covers lost income when you cannot trade.
Cyber Insurance: Not required by law, but recommended if you hold personal data or rely on IT. Covers data breaches, ransomware and regulatory fines where insurable.
Key Person: Not required by law, but worth considering if your business depends on a few people. Covers the business if one of them dies or is incapacitated.

Choosing the right cover

Do you employ anyone? Employers' Liability is required by law
Do you use vehicles for work? Business motor insurance is required by law for use on roads or in other public places
Are you in a regulated profession? Check whether your professional regulator requires Professional Indemnity, and how much
Do you deal with customers or visit other premises? Public Liability is not required by law, but clients and landlords often require it
Do you make or sell physical products? Products Liability is not required by law, but essential

Employers' Liability Insurance Requirements

Insurance required by law for businesses that employ staff

Required for: Employers of anyone, including part-time staff
Minimum cover: £5 million
Fine, no insurance: Up to £2,500 for each day
Fine, certificate not displayed: Up to £1,000
Covers: Employee injury or illness claims
Exempt: Employers with only close family as employees, unless the business is a limited company
Exempt, based abroad: Employees normally based abroad, until they spend 14 days continuously in Great Britain (7 days on an offshore installation)
Exempt, single employee: A company whose only employee is its owner and who holds 50% or more of the issued share capital

Employers' Liability Insurance (opens in a new tab)

Employers' Liability Insurance Requirements

Insurance required by law for businesses that employ staff

Required for: Employers of anyone, including part-time staff
Minimum cover: £5 million
Fine, no insurance: Up to £2,500 for each day
Fine, certificate not displayed: Up to £1,000
Covers: Employee injury or illness claims
Exempt: Employers with only close family as employees, unless the business is a limited company
Exempt, based abroad: Employees normally based abroad, until they spend 14 days continuously in Great Britain (7 days on an offshore installation)
Exempt, single employee: A company whose only employee is its owner and who holds 50% or more of the issued share capital

Employers' Liability Insurance (opens in a new tab)

Clients, venues and landlords often make public liability cover a contract condition, and many ask for at least £5 million.

Optional Business Insurance Types

Valuable insurance types to consider based on business needs

Directors & Officers (D&O): Protects company directors from personal liability for management decisions
Cyber Insurance: Covers data breaches, cyber attacks, ransomware, business disruption and regulatory fines where insurable
Business Interruption: Covers lost income and ongoing costs if you cannot trade due to fire, flood, or other event
Contents and Equipment: Protects business assets (computers, machinery, stock) from theft, fire, or damage
Buildings Insurance: Not required by law, but recommended if you own business premises. Commercial mortgage lenders often require it
Key Person Insurance: Compensates the business if someone it relies on, such as a founder or director, dies or is seriously ill

Legal basis

Primary legislation and key regulations

Road Traffic Act 1988 Primary 1988 · UK-wide ELCIA 1969 Primary 1969 · UK-wide Legal Services Act 2007 Primary 2007 · UK-wide Financial Services and Markets Act 2000 Primary 2000 · UK-wide Architects Act 1997 Primary 1997 · UK-wide Employers' Liability (Compulsory Insurance) Regulations 1998 SI 1998 · UK-wide

Browse UK legislation legislation.gov.uk

Official guidance

Index (opens in a new tab)

HSE · Great Britain

Vehicle insurance requirements (opens in a new tab)

DfT

Employers' liability insurance (opens in a new tab)

GOV.UK

Business insurance types quick reference

Legal basis

Official guidance

Next steps

Growing your business

Start importing goods to the UK

Transfer ownership of your business

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