The deal means that the AA is launching new products to add to its commercial range, including insurance for recovery operators, the taxi trade, motor traders and repairers and self drive hire companies.

Andrew Strong, the AA’s chief executive, points out that these motor industry products align well with the AA’s motoring pedigree.

“The AA is a household name for roadside assistance as well as motor insurance, including van and commercial vehicle cover. Adding specific motor trade insurance is a natural extension to the range and, in addition, forms a perfect fit with the AA’s fleet business breakdown cover.”

As part of the deal, Bollington is offering AA fleet cover to its own commercial customers.

Paul Moors, chairman of the Bollington Group said: “We have worked extremely hard to win this imaginative and creative relationship with the AA. We have over 40 years’ experience in the commercial broking sector and I believe that this is one of the most significant new ventures in the commercial market.

“Our broking experience, coupled with the AA’s marketing ability, is a perfect arrangement. It offers huge potential including development of new services created through AA’s financial services such as business credit card or fuel cards.”

Strong said that in the past, the AA has concentrated on distribution of commercial insurance through customers who buy other insurance products and, while that has been growing steadily, it represents a small part of the total business market: “There’s a greater need today for advice and tailoring products to suit individual requirements.  Now we have that opportunity through our new relationship with Bollington – not just in the motor sector but amongst small businesses of every sort.”

Apart from the motor trade, the AA offers cover for pubs, restaurants, hotels and guest houses; small businesses such as traders, contractors, landlords, consultants and shop keepers; and van and small commercial vehicle fleet cover. Risks include buildings and contents, liability, employers’ and professional indemnity, tools and goods in transit.

NatWest and RBS will offer customers a range of solutions:

Fast-track requests for temporary credit increases provide short term financing to cover cost of repairs and replacement stock while businesses wait for insurance claims to be paid offer repayment holidays on existing loans to give businesses the breathing space they need to get back on their feet refund or waive overdraft fees incurred as a result of the riots on a case by case base basis. Other banks have announced similar schemes.

Meanwhile, businesses who have suffered damage as a result of the riots need to claim on their insurance quickly or they risk not being able to recover their losses, warns City law firm Reynolds Porter Chamberlain LLP (RPC).

RPC explains that most insurers require claims for riot damage to be notified within a very short period – typically seven days – otherwise the claim may be rejected.

This is because the insurer can make a claim in the policy holder’s name against the police to recover their losses under the Riots (Damages) Act 1886 (RDA). However, to do so that claim must normally be lodged within 14 days of the damage occurring.

Businesses that have suffered riot damage that do not have property insurance can also make a claim to recover their losses directly from the police under the RDA.

Stuart White, partner at RPC, comments: “Riots have caused millions of pounds worth of damage over the last few days.  Businesses that have suffered riot damage should notify their insurer as soon as possible so as to avoid being left without insurance cover. Any delay is an unnecessary risk.”

“Some independent retail units have been completely destroyed by the rioters, making them dependent on recovering the value of the damage to start trading again.”

“The good news for some of the smaller retail units that have been damaged is that even if they do not have a property insurance policy they may be able to recover the value of any damage sustained because of the rioting directly from the police.”

“However the compensation under the RDA will not normally extend to the financial losses of the business while it is unable to trade.  Trading losses are likely to be recoverable only by businesses with business interruption insurance.”

Stuart White adds: “Given the scale of these riots and the current pressure on police budgeting there will doubtless be calls to reform a law that compels police forces to compensate businesses and individuals for riot damage.”

“We will see whether insurers who cover police forces for the cost of RDA claims respond to these riots by pushing up the cost of their insurance.”

Accidents and crimes do happen, so it’s worth making sure your business won’t suffer in the case of loss.

For the most part, insuring the possessions of your business is much the same as insuring your personal possessions. Simply tot up what they are worth, get a quote, and if you suffer a loss, claim on the policy. But there’s a little more to it than that.

When it comes to the possessions of your business, insurers broadly divide the categories up into three separate areas: buildings, stock and business equipment.

Vehicle insurance is considered completely separate. Usually you can get a policy that covers everything, but it’s worth considering what’s involved in each.

And in these credit-tight times, financial institutions are finding it harder than ever to make any profit out of lending money.

So they’re searching around for something else, and insurance is right at the top of the list. For SMEs, this is fantastic news. The more institutions that want your business, the fiercer the competition. And this will hopefully mean better policies at lower prices.

Banks earn huge commissions from selling insurance to customers – often the bank you have your current account with will offer insurance, even though it is not the company that actually provides it – and these costs, often as much as 30 per cent of the premium, are sure to be passed on.

Buildings insurance

If you have a mortgage on your property – and in most cases if you have a business lease – this will be a compulsory product.

While the lender retains an interest in your property, it will expect you to protect it.

If your premises are burnt to the ground, repaying the mortgage will be the last thing on your mind, but it will be the first thing on the lender’s agenda.

There is no industry-wide definition of what buildings insurance comprises, but basically it is what you would leave behind if you metaphorically tipped it upside down. So in addition to the walls, windows and roof, this should include fitted kitchens and bathrooms. It should also cover any outbuildings, such as garages or sheds – although you need to inform your insurer of their existence.

Most insurers require you to set an insurable value for your property and this can be where problems arise. The insurable value is not the same as the value of the property – part of that is the land, which you will still own even if there is nothing left on it. This is true even for office blocks, as you still retain the right to use that particular space.

The figure that needs to be insured is the rebuild cost. This is what it would cost to return the property to its existing condition if it were completely destroyed. It’s much less than the value of the property, but it’s almost impossible for

non-insurance specialists to work out themselves. There are so many variables to consider – the type of materials, the location, surrounding buildings and so on.

Insurers nowadays don’t really expect you to put a figure on it. Many insurers nowadays will work out the figure for you, based on the location and type of the property, and how big it is. They will then guarantee to cover any claim if a disaster does take place.

Buildings insurance can be comparatively cheap. The most common causes of insurance claims is crime-related, and most burglars tend not to steal the fixtures and fittings.

What the premises are used for will be key – if you’re just insuring an office, you’re not going to have to pay too much, for example, but if it’s a factory where gas cylinders are kept, or a restaurant – with a high possibility of fire – then you’re going to be paying more. If you have a regular stream of customers coming on to the premises, that will add to the cost, as damage is more likely to happen.

There is also likely to be a higher price if you are the type of business that attracts criminals – your windows are less likely to be broken in a burglary if you are an estate agent compared to a jeweller, for example.

Contents insurance

While no-one is going to force you to take it out, only a fool would fore-go the security of contents insurance.

Contents insurance is supposed to cover everything to do with your business that that you use to run it – not what you sell. So computer equipment, fixtures and fittings in a shop, machinery in a factory and so on.

Virtually all contents policies nowadays are written on a ‘new for old’ basis. This means that if you claim for an item that has been lost or irreparably damaged, you will get the replacement value, not what the item was worth before the claim.

But insurance companies don’t like handing out cash to claimants; they believe it encourages fraud. What companies do is attempt to replace the items for you. To save money, they have agreements in place with major retailers to provide them with claimed items. So if, for example, your computer equipment was stolen, the insurer would request a list of the products and would acquire them on your behalf.

Stock

This is essentially everything you plan to sell as part of your business – whether it’s the contents of a shop or warehouse, or even the output of your factory. Again, the price of the policy will depend on the value of the stock you typically hold, but also its fragility and its attractiveness to crooks.

Again, jewellers are likely to pay more. It’s not only a good thing from a cost control point of view to maintain as low a base of stock as possible, it’s also going to make it less expensive to insure.

Business types

Some insurers don’t insure certain types of business. Restaurants often need specialist cover, as do hairdressers and bookmakers.

Even those that promise to insure all businesses will often load the premiums onto firms they’re not particularly keen on.

So it makes sense to shop around.

Specified items

If you have any particularly valuable items – the amount depends on the insurer, but check if anything you own is worth more than £1,500 – then these will have to be specified on the policy. You may be required to provide photographs or serial numbers of the items.

Cut costs

Your insurance policy will be priced according to the risk the insurer sees of having to pay out. So anything you can do to protect your business will reduce the cost of the policy. Most of these are security related – installing a burglar alarm or a window locks will lower the premium, for example. Different insurers have different criteria, so it’s worth contacting yours to see where you can make savings.

Bundling

While it is not always possible most insurers recommend that you take out your buildings and contents insurance together.

By doing so, you could save money because many companies offer discounts for taking out both products. But also, if one company insures both your building and your contents, there is far less chance that in the event of a claim, certain items slip through the net. Most companies have very similar definitions of what constitutes buildings cover and what comes under contents, but if there are any grey areas it could cause a lot of heartache when you least need it.

Allianz will provide tailored solutions, designed to meet the specific needs of this market. The packages will cover a wide range of risks including property, surgery contents, liability and business interruption.

David Martin, head of SME, affinity and broker markets at Allianz, explained: “The package we have developed for Farleys offers a strong and specialised solution which is ideal for niche client markets. Our SME business is thriving as we continue to develop our proposition and we aim to expand into other client sectors in the near future.”

Marilyn Armitage, director of claims & schemes at Farleys Insurance Brokers, added: “Allianz understood our objective of offering an exclusive portfolio of cover and services, designed and costed specifically to suit the changing needs and strategies to small businesses.”

Whilst making sure the right insurance is in place is important for SMEs, as a specialist small business insurer, Hiscox understands that business owners want to focus on what they do best – running their business.

So it has created a Business Insurance Decision Tree in the form of an infographic to help steer small business owners through the different types of insurance available to them. The Decision Tree looks at variables such as whether you work from home or in an office, how many employees you have and what type of property you own, suggesting applicable cover which best suits an SME’s needs.

So whether it is office contents insurance for damage to property, employers’ liability for those with employees, professional indemnity insurance when offering advice, or public liability insurance, the Business Insurance Decision Tree can help clarify which insurance is suitable.

Hiscox SME underwriting manager, Deepak Soni, commented: “SMEs are experts in their area, but we don’t expect them to be experts in insurance, that’s what we are here for. No two businesses are the same, so the Business Insurance Decision Tree is a useful tool to help SMEs understand the risks they face and get the right cover in place.”

The Decision Tree is available on the Hiscox website at http://www.hiscox.co.uk/business-insurance/tips-and-information/which-business-insurance-is-right/

Hiscox insures more than 100,000 small businesses in the UK, offering a range of business products, visit now for further information.

Over half (53 per cent) of British entrepreneurs put their business success down to their own innate talents which cannot be learnt or taught, according to new research* of 500 entrepreneurs. This compares to 13 per cent who believe that learnt skills or education have been the driver in launching their business idea.

A debate on the research findings by small business insurance provider Hiscox, attended by some of the country’s leading entrepreneurs and business experts reached the conclusion that entrepreneurship is more nature than nurture, although did also suggest that some key business skills can be learnt. The discussion also concluded that the current financial climate presents significant opportunities for aspiring entrepreneurs.

Hosted at the Royal Institution by science journalist Vivienne Parry, the Hiscox sponsored ‘nature or nurture’ debate saw Steve Ridgway, CEO of Virgin Atlantic Airways, Max McKeown, business author and strategic adviser, and Daniel T Jones, founder and Chairman of the Lean Enterprise Academy, argue what attributes they believe contribute to entrepreneurial success.

Entrepreneurship as an art

Max McKeown, supporting the nature side of the debate, said that entrepreneurship is an art, something that comes from a set of abilities that cannot be learnt. He also commented that entrepreneurs need innate qualities such as ambition in order to make the leap from having a great idea to actioning it: “Who’s more likely to succeed – someone with high skill and no ambition, or no skill and high ambition? If you’re an entrepreneur, you can hire as many skilled people for your business as you want.”

Hiscox’s research supports that view, with 23 per cent of entrepreneurs questioned stating they were not university educated and just 13 per cent believing business success is down to education or relevant experience. Respondents also listed innate attributes led by an analytical mind (81 per cent), followed by creativity (73 per cent), drive (66 per cent) and good communication skills (63 per cent) as key to business success.

Entrepreneurship as a science

But the research also acknowledged nurture as an influence: 88 per cent of entrepreneurs worked for another company before starting their own business and 30 per cent had studied business and management, showing that gaining competencies and experience within an established company can be an important part of business success. Professor Jones echoed the need for experience when debating for the side of nurture. He argued that entrepreneurs often fail at first, learning from their mistakes, and that some key entrepreneurial traits, for example problem solving, can be taught.

The lively discussion about the nature of entrepreneurship concluded with all panelists agreeing that post-recession is a time ripe for would-be entrepreneurs, citing successful companies Hyatt Hotels and MTV, which were born in similarly challenging economic times.

Professor Jones said that the recent downturn proved the current business model was broken: “Now is the time for entrepreneurs to really flourish”. Steve Ridgway commented that tough economic times always bring out business talent: “Entrepreneurs will go to hell and back if they believe in an idea.” Max McKeown echoed this thought, saying: “Entrepreneurs don’t believe the future is predictable – but they do believe that they can create the future themselves.”

Commenting on the debate, Alan Thomas, SME expert at Hiscox said: “One thing that’s clear is that it’s hard to package the profile of an entrepreneur into a ‘one size fits all’ format. While some people have all the required qualifications on paper, they may lack the innate abilities of a natural born risk taker or vice versa. It’s good to see that despite, or maybe because of, recent economic challenges, the spirit of entrepreneurship remains alive and well in this country.”

Hiscox insures more than 100,000 small businesses in the UK, offering a range of business products including public liability insurance and professional indemnity insurance.

Hiscox SME insurance expert, Alan Thomas, commented: “In light of these latest Government figures and the importance of data to businesses, it is essential that SMEs have strategies in place to mitigate online risks. Our research reveals businesses are now more concerned about cyber crime (22 per cent), such as hacker attacks and electronic ID theft, than having cash (eight per cent) stolen from their premises.”

“Our research also revealed that over a third (38 per cent) believed that their businesses are more likely to be a target of burglary since the start of the financial downturn which makes it all the more important to put in place robust security measures.”

Hiscox offers the following security tips to help SMEs to protect against online and offline risks:

Protect information with a need-to-know policy with employees. If storing information on a central file server, manage who has access to files. This can help prevent data loss whether accidental or deliberate

Running an enterprise is a full-time activity and if you do not have online technical expertise seek professional advice on security. This can both save time and ensure the security measures cover the business needs

Encrypt important information for extra security so that only authorised users will be able to access them

Using the internet and email to conduct business means that data loss becomes a risk. Develop a clear email policy and raise online security awareness and issues with employees

Back up your files and check your insurance cover so that you can get business up and running again quickly in the event of an incident

Items like laptops and computer monitors are common targets for thieves and the real cost of a stolen IT asset isn’t just the hardware, it’s the lost data and the lost productivity. Lock servers in a room and move laptops into a secure drawer at the end of a working day .

The responsibilities that come with running a business may seem somewhat daunting at the start, but there are a number of insurance policies that can help you protect yourself and your business.

Running your own business may be an exciting and profitable enterprise, but along with the rewards come a number of responsibilities. And no matter how careful you may be, one slip could end up costing you and your company a fortune.

The growth in ‘no win, no fee’ lawyers means that more people are heading for litigation if they have suffered harm, and can put the blame on to a business. As most cases don’t go to court – they are settled by mutual agreement – there are few figures for the numbers of cases but, says the Association of British Insurers, they run into the tens of thousands each year.

Essentially, says Tim Lazenby, managing director of FSB Insurance Services at Towergate Riskline, you need to both legal and asset protection. “You build up your levels of protection as your business grows – there are certain policies you need to start with, but as the money starts to come in, it’s all about transferring the risk [from your business to the insurer].

Asset protection

Every small business will have an asset worth protecting, whether it’s your stock, your computer, or a large factory. The key policies you need to consider are:

Vehicle insurance: If you run vehicles, you have to have insurance, it’s the law. But it’s relatively easy to get yourself covered, and even businesses can spread the cost over a year. Check though that you won’t be charged interest if you want to pay monthly – what may look like the cheapest headline rate can swiftly come up costly if the premium is loaded. If you lease your vehicle, some providers will include insurance as part of the cost of the lease. And if you use it to carry your tools or equipment, make sure you empty them out at the end of each day – unless specified, your policy won’t cover anything left inside overnight.

Buildings insurance: If you own the property, you will definitely be responsible for insuring it, and it’s likely that if you lease premises, you’ll still need to do so – it’s usually a condition of the lease, or any finance secured on the property. The level of cover you need is not the value of the property, it’s the amount that it would cost to rebuild if it was completely destroyed – after all, the land would still be there, and that makes up a significant part of the value.

It’s virtually impossible for a layman to work out the rebuild cost; some insurance companies will work it out for you, or you may need to engage a surveyor to give you the information. But it’s worth getting it right – estimate too low, and you’ll be uninsured; too high and you’ll be paying too much for the premium.

Contents insurance: Whatever you keep within your premises – or anywhere else – should also be protected. While it’s unlikely to be a legal requirement, just think of how you would be able to run your business if you lost the tools you need to carry it out. It can be worthwhile to bundle the buildings and the contents insurance – in addition to any discounts you may get, it also protects you from items slipping through the net – those not covered by either policy. If you run your business from home, check your home insurance policy covers you – many don’t and you may need to look into getting extra cover.

Legal protection

Small business insurance policies can help you in the event of making a claim, but they don’t absolve you of responsibility. “Small businesses have a responsibility to their staff, their customers and their suppliers – if you don’t comply with the rules and regulations, it’s not just a civil claim you could encounter, you could also be liable for criminal charges,” says Malcolm Tarling from the ABI.

Here are the business liability insurance policies SMEs need to consider:

Employers’ Liability Insurance: This is a legal requirement if you have employees, which is defined as someone who is working for you on your premises. It’s there to cover you if any employee claims for an injury or ill-health while working for you. This doesn’t necessarily just mean someone falling off a ladder or slipping on an icy surface; some of the biggest claims have arisen from problems nobody knew about at the time, such as exposure to asbestos or other harmful chemicals. And as a result, the claims can go back decades – because the evidence of harm may take some time to come up, it’s worth keeping a record of who your insurer is for any given period.

“It’s a strict liability cover, that’s for anyone who works under your instruction,” says Lazenby. “You must have it and you must display the policy in the workplace. The minimum cover you are required to have is £5 million, though most policies will automatically offer £19 million.”

Public Liability Insurance: Over £1 billion a year is paid out in public liability insurance claims, and many small businesses go out of business because they are not covered. A public liability insurance policy will protect you from claims from members of the public who visit your premises – so if you have visitors to your place of work, then this is a must. It will also cover you if you cause damage to a third-party property while carrying out your business.

Product Liability Insurance: If you manufacture, repair or adapt any products, then product liability insurance will protect you from any claims related to injury or damage as a result of a fault or flaw in the product. The price of a policy for this varies greatly, depending on the product in question – the greater the risk of the product, or the more damage it could do, the more expensive it will be.

Directors’ and Officers’ Insurance: Just because you run a limited company doesn’t mean that you are immune from any potential claims. “It’s one of the areas that few businessmen know about and the repercussions can be huge,” says Tarling. Company directors and officers must comply with over 200 areas of statutory liability under the various Companies Acts, and can face personal costs if they are found to have acted improperly. This cover provides insurance for those who have inadvertently acted outside the rules and face penalty.

Business Protection

While the recent swine flu outbreak has not – yet – had the disastrous impact on British businesses that some predicted, there are plenty of unforeseen events that could cause businesses to struggle.

There are some estimates that 80 per cent of businesses with no business continuity plan fold in the aftermath of a major disaster. And while this could be something along the lines of a national emergency such as a terrorist attack or health epidemic, it could just as easily be something closer to home, for example the incapacity of a key member of the business. Or it could be something as simple – yet damaging – as a strike leaving you out of contact with your customers.

Putting a plan in place can not only help you arrange procedures for dealing with emergencies; it also provides a step-by-step guide for individuals to follow when they may be finding it difficult to make decisions – giving them a route to follow will help them work through the crisis.

“By developing a simple plan, a business continuity plan, you can protect your business to ensure that no matter what disaster strikes you are prepared and “Business as usual” is the only thing your customers and suppliers see,” says Colin Ive from SME Continuity.

Your first step, according to the Contingency Planning and Disaster Recovery Guide, is to prepare a list of all the potentially serious events that could happen. This doesn’t necessarily mean listing all the disasters that could befall you, but looking at the issues that would affect your business. So instead of listing swine flu, ebola or any other illness, the list would include something along the lines of staff shortages or key person unavailability.

For each potential issue, you need to come up with a process to follow – the key people involved, any suppliers that need to be contacted, a list of contractors who may be able to support you and, vitally, any insurance policies you can claim on.

While business insurance won’t be able to completely prevent any effects of a disaster, it can help to mitigate any costs you may incur. Key Man Insurance can provide a cash injection into a business in the event of the untimely death or incapacity of a specified member of staff. The funds can be used to offset any loss of revenue caused by that person’s absence, or to recruit or train a new person in that position.
If your business is hit hard, and has to stop trading for a short period, Business Interruption insurance can help to tide you over. It’s a short term solution for a few weeks and is there specifically for if you have to stop trading due to factors outside your control – it doesn’t cover a downturn in trading conditions.

If the emergency is a bit closer to home, public liability insurance and employers’ liability insurance will protect you from claims for issues that arise on your premises. We live in a culture of litigation and if an injury or damage could be found to be your responsibility, then expect a hefty bill.

Costs

For all types of cover, the cost of the insurance will depend on the business you are in, and your and your company’s claims experience. For example, an office based business will play less than a firm supplying parts to the airline industry.

Lazenby, who represents a broker, says that independent advice is vital for small businesses. “There are niche products available for specific businesses, which may be difficult to find, and only a specialist will be able to ensure you have exactly the cover you need.

Even a small incident or power cut lasting only a few minutes could potentially prove costly for business owners.

UK consumers spend £5 billion on frozen food every year, with caterers using a further £2.5 billion of frozen goods. Small businesses, including grocers, petrol station owners and newsagents all rely heavily on fridges and freezers to store goods on site.

It is crucial for business owners to have and maintain back-up generators for all fridges and freezers, in order to prevent goods from being ruined if the main electricity supply is cut or damaged in any way.

To reduce the risk of having a large fridge or freezer related loss, business owners should:

• install and maintain back-up generators;
• install temperature controls and alarms with remote signalling to inform the owner that the unit is gaining or losing temperature.  Alarms are available to ensure temperature range is sufficient for the type of stock being stored;
• if practical, keep a spare storage fridge or freezer to transfer goods into in the event of a problem;
• train all staff how to respond in the event of a refrigeration unit breaking, including how to start the back up generator; and
• determine at what stage of defrosting stock is considered beyond use.

David Greaves, SME trading director at RSA, said, “Businesses need to take precautions, especially during the hot summer months to ensure they are maintaining all electrical equipment on their premises. If a fridge or freezer breaks down, they may have to throw away stock and then replace it all. Following RSA’s risk assessment guidelines could save small businesses significant unnecessary cost.”

There are some estimates that 80 per cent of businesses with no business continuity plan fold in the aftermath of a major disaster. And while this could be something along the lines of a national emergency such as a terrorist attack or health epidemic, it could just as easily be something closer to home, for example the incapacity of a key member of the business. Or it could be something as simple – yet damaging – as a strike leaving you out of contact with your customers.

Putting a plan in place can not only help you arrange procedures for dealing with emergencies; it also provides a step-by-step guide for individuals to follow when they may be finding it difficult to make decisions – giving them a route to follow will help them work through the crisis.

“By developing a simple plan, a business continuity plan, you can protect your business to ensure that no matter what disaster strikes you are prepared and “Business as usual” is the only thing your customers and suppliers see,” says Colin Ive from SME Continuity.

Your first step, according to the Contingency Planning and Disaster Recovery Guide, is to prepare a list of all the potentially serious events that could happen. This doesn’t necessarily mean listing all the disasters that could befall you, but looking at the issues that would affect your business. So instead of listing swine flu, ebola or any other illness, the list would include something along the lines of staff shortages or key person unavailability.

For each potential issue, you need to come up with a process to follow – the key people involved, any suppliers that need to be contacted, a list of contractors who may be able to support you and, vitally, any insurance policies you can claim on.

While business insurance won’t be able to completely prevent any effects of a disaster, it can help to mitigate any costs you may incur. Key Man Insurance can provide a cash injection into a business in the event of the untimely death or incapacity of a specified member of staff. The funds can be used to offset any loss of revenue caused by that person’s absence, or to recruit or train a new person in that position.
If your business is hit hard, and has to stop trading for a short period, Business Interruption insurance can help to tide you over. It’s a short term solution for a few weeks and is there specifically for if you have to stop trading due to factors outside your control – it doesn’t cover a downturn in trading conditions.

If the emergency is a bit closer to home, public liability insurance and employers’ liability insurance will protect you from claims for issues that arise on your premises. We live in a culture of litigation and if an injury or damage could be found to be your responsibility, then expect a hefty bill.