Insurance is a crucial element of your business, and it’s important to make sure it’s active at all times to ensure that your assets and organisation aren’t at risk. However, mistakes happen and if your insurance does lapse, can you continue to trade and what can you do to rectify the situation? Read on to find out!
Depending on the type of business you run, insurance may not be a legal requirement (an exception is if you have employees, in which case it’s usually required by law that you take out employers’ liability insurance), which means that your can continue to trade, albeit without the benefits of insurance. As business insurance covers you for legal fees, property damage and loss of income, it’s important that you reinstate your policy as soon as you can.
The biggest impact of a lapsed policy is loss of coverage, leaving your business vulnerable to events, although there can also be implications down the line, such as increased premiums — insurance providers will categorise you as high risk as they will expect there to be further lapses in the future. Without insurance, your business becomes responsible for every risk and each potential event — for example, if someone was to injure themselves in your premises, you would have to pay any legal costs out of your business profits, rather than via your policy.
Insurance companies will usually contact you when your insurance is up for renewal, or some may automatically renew the policy for you. If your insurance has lapsed due to a missed payment, you may be offered the chance to make the payment within an agreed time-frame to reinstate the policy, although you could be subject to some fees for doing so.
Our advice is always to ensure that your business is adequately covered, and that you keep policies in place for the time they are relevant to your business and its operations. If you need any advice about business insurance, speak to one of our expert team today!
