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Recommended insurance products to take out?

Discussion in 'General Business Forum' started by Kerwin, Jan 12, 2021.

  1. Kerwin

    Kerwin UKBF Regular Free Member

    154 14
    I need to find out what insurance I need. I work from home and use a computer to do all of my business work. The internet connection is also essential. I will be selling server hosting to my clients.

    What sort of insurance should I be looking to get? If you need any more information then let me know and I'll try and provide it.
     
    Posted: Jan 12, 2021 By: Kerwin Member since: Dec 1, 2018
    #1
  2. Scalloway

    Scalloway UKBF Legend Free Member

    16,743 3,559
    Does your home insurance cover you for doing admin work at home?
     
    Posted: Jan 12, 2021 By: Scalloway Member since: Jun 6, 2010
    #2
  3. mattk

    mattk UKBF Newcomer Free Member

    2,456 897
    In my experience clients will specify a minimum level of insurance coverage. Will you be bidding on tenders, as these will give you examples of what you need?

    Typically, these will be things like Public liability and Professional indemnity up to £2,000,000.

    The biggest risk for you as a hosting service will be data breach. Companies will demand unlimited liability of your company in event of a data breach, as they can face a fine of up to 4% of turnover.

    Obviously, in contract negotiations, no one accepts unlimited liability, but you will need to make sure you are sufficiently covered.
     
    Posted: Jan 12, 2021 By: mattk Member since: Dec 5, 2005
    #3
  4. Financial-Modeller

    Financial-Modeller UKBF Enthusiast Full Member

    904 341
    Are you selling hosting services to commercial customers that is dependent on your residential internet connection? Do your clients know that?
     
    Posted: Jan 12, 2021 By: Financial-Modeller Member since: Jul 3, 2012
    #4
  5. estwig

    estwig UKBF Legend Free Member

    12,653 4,527
    Not if you don't tell them!!

    Let's see how much money we can waste, buying products sold on fear!!
     
    Posted: Jan 12, 2021 By: estwig Member since: Sep 29, 2006
    #5
  6. Frank the Insurance guy

    Frank the Insurance guy UKBF Regular Full Member

    148 26
    Hi @Kerwin ,

    There is no hard and fast rule as to what Insurance you should have.

    You need to consider what things could happen that will affect your business and whether you are happy to take the risk yourself or look at an insurance policy that will step in.

    For a business such as yours, you may wish to consider:
    1. Home Office policy - to pay for replacement computer etc if it is damaged or stolen. You can extend cover to include Business Interruption to cover loss of revenue as a result of a loss of internet connection (although cover usually states your connection must be down by x hours before they will pay)

    2. Professional Indemnity policy - to defend you against claims or allegations that your services (or failure of services) have caused your client a financial loss and payment of damages if you are found to be at fault. If arranged properly, this policy will also extend to include claims where your client suffers a data breach which you have caused.

    3. Cyber & Data Protection - to pay for your own costs of investigating and fixing a cyber attack/hack on your own system and your own data breach

    Note - there is crossover between Professional Indemnity and Cyber/Data Protection and I would therefore suggest you seek professional advise from an independent insurance broker if you are considering these.

    Assuming the hosting you are selling is hosted by a proper third party hosting company, the premiums for your type of business should be pretty low. But this will depend on the T&C's with the hosting provider and your clients.

    For information on other types of insurance policies available see our simple guide

    Feel free to contact me directly if you want some more detailed advice or a quotation.
     
    Posted: Jan 12, 2021 By: Frank the Insurance guy Member since: Oct 28, 2020
    #6
  7. Kerwin

    Kerwin UKBF Regular Free Member

    154 14
    Oh the servers will be hosted in a datacentre in Surrey or London.
     
    Posted: Jan 12, 2021 By: Kerwin Member since: Dec 1, 2018
    #7
  8. Frank the Insurance guy

    Frank the Insurance guy UKBF Regular Full Member

    148 26
    Do you own/lease the servers - or do they belong to a third party hosting provider?

    You need to consider this when considering the right insurance cover you want.
     
    Posted: Jan 13, 2021 By: Frank the Insurance guy Member since: Oct 28, 2020
    #8
  9. Kerwin

    Kerwin UKBF Regular Free Member

    154 14
    I own the server but there is a possibility that I might get some on finance in the future.
     
    Posted: Jan 13, 2021 By: Kerwin Member since: Dec 1, 2018
    #9
  10. Frank the Insurance guy

    Frank the Insurance guy UKBF Regular Full Member

    148 26
    In this case you are reliant on the server for your revenue - I suggest you also consider a Computer Insurance policy that extends to include business interruption for loss of use following damage or loss of telecoms etc.

    However this could prove expensive - particularly if you do not have a suitable back up at a another location.

    You will need a robust and tested Disaster recovery plan, and suitable Service Level Agreements, to ensure you can get insurance cover at a reasonable premium.
     
    Posted: Jan 14, 2021 By: Frank the Insurance guy Member since: Oct 28, 2020
    #10