Your guide to SME Insurance

If you own a small or medium-sized enterprise (SME), it’s important you have the right business insurance in place to suit your needs.  Small businesses can face a wide range of risks, some of which aren’t immediately obvious.  

To help ensure your business has the protection it needs, we created Jensten Insurance Brokers’ Guide to SME Insurance.   

What is SME insurance?

SME insurance can offer small and medium-sized enterprises a package of financial protection to cover the risks their businesses face.  The precise makeup of a policy will depend on things like the size of your business, what sector your business is in, whether you have any employees, and what activities your business carries out.   

What insurance does an SME need?

Just as every business is different, so are their insurance needs.  In our experience, an SME business can typically require cover such as: 

• Public liability insurance – covers you if a customer or member of the public claims they have been injured or their property damaged because of your business activities. 
• Buildings insurance – if you own the premises you work from, you’ll want to include business buildings insurance in your SME insurance policy.  That way, if it’s damaged or destroyed, you’ll be able to claim for repairs or a rebuild. 
• Employers’ liability insurance – employers’ liability insurance is a legal requirement if you employ one or multiple people.  It can cover the costs in the event of an employee injuring themselves or damaging their property whilst at work, and if they become ill because of working for you.   
• Business interruption insurance – if disaster strikes – a fire or a flood, for example – and you’re unable to trade, business interruption insurance can help to provide an income until you get back to your previous level of trade. Cover will depend on your policy wording and limits.
• Cyber insurance – cyber-attacks on SMEs are on the rise in the UK.  Research from Hiscox has revealed that 53% of businesses suffered a cyber-attack in 2023, up from 38% in 2022.  With the government putting the average cost of a successful cyber-attack at £15,300, this is a potentially costly growing problem.  
• Stock insurance – many businesses have stock of one form or another, and stock insurance can provide cover should it be stolen, lost, or accidentally damaged. 

• Professional indemnity insurance – can cover the cost of compensating clients for loss or damage resulting from negligent services or advice provided by a business or an individual depending on your policy limits. This could be an important cover for you if you offer advice or skills as part of your business proposition.  
• Directors’ and officers’ insurance – or D&O insurance as it’s also known, provides cover for business owners and directors from legal action that arises for alleged wrongful acts.  These acts include a breach of trust, breach of duty, neglect, and error.
• Product liability – if your business sells, uses, recommends, or manufactures products and they cause problems, you can be liable for damages.  Product liability insurance can protect you if your products cause injury or illness and legal claims are brought.
• Contents and portable equipment insurance – without essentials such as computers, office equipment, fixtures and fittings, and mobile phones, most businesses can’t function properly.  Business contents insurance can provide cover for these items should they be lost, stolen, or destroyed in a fire or flood. 

What are the benefits of SME insurance?

SME insurance offers business owners several advantages, including: 

• It gives your business the cover it needs under one policy.  
• It can work out cheaper than getting individual policies for each risk. 
• The ability to select the elements you need to cover the risks your business faces. 
• It makes administration easier as you only have one renewal date and one broker to deal with in the event of a claim. 

* OnePoll survey 2023