According to a recent study, more than one in 10 small businesses has been forced to suspend trading due to disruption in the last two years. Were these businesses covered by suitable insurance? And, how did the pause affect their business?
Pressing Pause on Business Trading
In the last two years, one in 10 small businesses have paused trading. This may sound like a relatively low figure, but if this ratio is applied to the five million small business in the UK it would equal to around half a million rested.
The Direct Line study found that the average amount of time a business was shut down for was more than three months. Whereas, 21% of those surveyed said they would not be able to survive for more than a month if they were caught in a similar situation and had to suspend trading.
Why? Well, an average two-week suspension would cost nearly £9,000, and, besides a reduction in revenue and profit, other common issues include a loss of customers and the need to use personal finances to bridge any gaps in financial loss.
How Can the Correct Insurance Help?
There are numerous reasons why a business may have to pause trading and unfortunately most are unforeseen - whether due to a fire or flood. When there is a disruption and business is paused, it can be a stressful time, but it doesn't have to be.
Business interruption insurance could cover your business in case a situation like this occurs. It will insure your business against any damage from the loss of income incurred by paused trading, and help ensure you can get back on your feet and begin trading once more when you're ready.
In short, business interruption insurance aims to put you back into the same trading position as you were before the essential break.
Every insurance provider will have a slightly different policy of cover. Common policies will protect a business should there be a fire, storm or flood, as well as if machinery or equipment breaks. More specialist policies may also include indemnity cover for any damage that may occur at a supplier or customer's property, as well as cyber protection.
Business insurance is not a legal necessity for organisations, but can you afford to take the risk of not taking out the cover?
Do You Need Business Interruption Insurance?
To build your tailor-made insurance package and to compare quotes online today, click here or call for a quote on 0800 470 4648/0333 202 6240.
This website is built using latest technogies. Unfortunately your browser doesn't support those. Please update your browser to view this website correctly. Thank you. Update my browser now