Business Legal Insurance Guide

By Olivia Johnson - Trusted UK Business Expert

Last Updated 4th of October 2024

5 minute read

Are you a business owner? Have you ever thought about what would happen if something happened to your business and you were no longer able to run it? If you haven’t, then now is the time to start thinking about it! One of the best ways to protect your business is by purchasing business legal insurance. This type of insurance can help cover the cost of any legal expenses that may arise if your business is sued or experiences some other legal issue. Keep reading for more information on how business legal insurance can help protect your company.  

What is Business Legal Insurance, and What Does it Cover? 

If you’re a business owner, it’s important to be aware of the risks that come with owning a company. One of the biggest risks is being sued or facing some other legal issue. This can be costly and stressful, which is why it’s important to have protection in place. Business legal insurance is one way to help protect your company in case of any legal issues. This type of insurance can help cover the costs associated with any legal expenses, which can be very helpful if your business isn’t able to pay for them itself. 

It mainly covers: 

• Employment disputes and compensation : You can be protected against unfair dismissal claims, redundancy claims, and harassment or discrimination claims. 
• Contract disputes and debt recovery : If you’re in a dispute with another business over a contract, or if you’re owed money by someone, your legal insurance can help cover the costs of taking legal action to try and resolve the issue. 
• Corporate identity theft protection : This can help cover the costs of taking legal action if your business’s identity is stolen, such as if someone uses your company name or logo without permission. 
• Data protection : If your business’s data is lost or stolen, or if you’re the victim of cybercrime, your legal insurance can help cover the costs of taking legal action and any resulting damages. 
• Tax protection : If you’re being investigated by HMRC or if you’re facing a tax dispute, your legal insurance can help cover the costs of taking legal action. 

How can you Get the Most out of your Policy for your Business Needs? 

When you’re taking out business legal insurance, it’s important to make sure that you’re getting the right policy for your needs. Here are some things to consider: 

• What type of business do you have? : The type of business you have will affect the risks you face and the cover you need. For example, if you run a food business, you’ll need to make sure that your policy covers you for food safety issues. 
• What size is your business? : The size of your business will also affect the risks you face and the cover you need. For example, if you have a small business, you might not need as much cover as a large business. 
• What’s included in the policy? : Make sure you check what’s included in the policy before you buy it. Some policies will only cover certain types of legal expenses, so it’s important to make sure that the one you’re buying covers the things you’re most likely to need. 

What are the Benefits of Having Business Legal Insurance in Place for your Company? 

There are many benefits to having business legal insurance in place for your company. Here are some of the most important ones: 

• It can help cover the cost of any legal expenses that may arise if your business is sued or experiences some other legal issue. 
• It can help protect your company in case of any legal issues. 
• It can help you avoid stress and financial difficulty if your business is sued or faces a legal issue. 
• It can give you peace of mind knowing that you’re protected against any potential legal problems that could arise. 
• It can help you save money in the long run by avoiding the need to pay for costly legal fees yourself. 
• It can help you protect your business’s reputation by avoiding any negative publicity that could come from a legal issue. 
• It can help you keep your business running smoothly by avoiding any disruptions that could come from a legal problem. 
• It can help you focus on running your business, knowing that you’re protected against any legal issues that might arise. 
• It provides protection for your business in the event of any legal problems, giving you one less thing to worry about. 

Bottom Line 

Business legal insurance is a type of insurance that can help cover the cost of any legal expenses that may arise if your business is sued or faces some other legal issue. It’s an important type of insurance for any business to have, as it can help protect your company in case of any legal problems. If you’re thinking about taking out business legal insurance, make sure you compare policies to find one that covers the things you’re most likely to need. We can provide you with a free, non-obligatory quote for business legal insurance today. Simply fill in our online form and we’ll get back to you with a competitive quote. 

FAQ

Is Business Legal Insurance the same as Public Liability Insurance?

No, Business Legal Insurance is not the same as Public Liability Insurance. Public Liability Insurance covers claims made by third parties for injury or property damage caused by your business. Business Legal Insurance, on the other hand, covers legal costs associated with disputes and legal action involving your business.

What types of legal issues are not covered by Business Legal Insurance?

Typically, Business Legal Insurance does not cover:

• Fines or penalties resulting from criminal offences
• Pre-existing legal disputes or claims made before the policy start date
• Deliberate or fraudulent acts by the business
• Certain types of intellectual property disputes (depending on the policy)
  Always check your policy for exclusions.

How much does Business Legal Insurance cost?

The cost of Business Legal Insurance depends on factors such as the size of your business, industry, and level of coverage. Premiums can vary widely, so it’s important to shop around and compare quotes from different insurers to find a policy that meets your needs and budget.

Does Business Legal Insurance cover tax investigations?

Yes, many Business Legal Insurance policies include coverage for legal expenses arising from a tax investigation by HMRC. This can help cover costs associated with defending against tax disputes or preparing for tax audits.

How do I make a claim under Business Legal Insurance?

To make a claim, contact your insurance provider as soon as you become aware of a legal issue. You’ll need to provide relevant documentation, such as contracts, communications, and details of the dispute. The insurer will review the case and guide you through the claims process, including covering legal representation if necessary.

Can I choose my own solicitor with Business Legal Insurance?

Some policies allow you to choose your own solicitor, while others may require you to use one from the insurer’s panel of approved legal professionals. If it’s important to use your own solicitor, make sure to confirm this with your insurer when purchasing the policy.

Does Business Legal Insurance cover court settlements?

Yes, Business Legal Insurance typically covers court settlements, including compensation or damages awarded to the other party. However, this depends on the policy and the type of dispute. It’s essential to review your policy details to understand the limits of coverage.

Why is Business Legal Insurance important?

Business Legal Insurance is important because it protects your business from the high costs of legal disputes, which could otherwise disrupt operations or lead to significant financial losses. With this insurance, you have access to legal advice and representation, helping you navigate legal challenges without risking your business’s financial stability.