Business insurance: the basics

The greater the risk you need to insure against, the higher your insurance premium is likely to be. For example, if you're a tree surgeon, working from a height and using power tools, personal accident insurance is likely to cost you far more than if you work in an office.

Manage risk

Managing the risks your business faces is therefore key to getting lower premiums. Look at the risks and work out what you can do to reduce them.

You could consider:

• improving security with additional locks, closed circuit television cameras or alarms
• introducing management systems to help you meet health, safety and environmental requirements - see set up a health and safety management system
• drawing up a business continuity plan, setting out how your business will continue in the event of a major incident - see business continuity and crisis management

A strong health and safety record can really help you reduce your premiums for a number of kinds of insurance, as insurers are likely to be particularly concerned about these risks. For information on managing these risks, see health and safety risk assessment.

Reduce insurance premiums

There are a number of other steps you can take to reduce premiums. You may want to increase the excess - the part of the claim you have to pay yourself - in return for a lower premium. Consider, too, whether it's worth making small claims if something does happen, as they could push your premium up.

An insurance broker will be able to help you identify ways of managing your risk.