Call issued for more business cover

Date: 19th October 2009

Commercial insurance cover is being skipped by many smaller businesses, new figures from Direct Line suggest.

According to the insurer, 28 per cent of all home-based firms have not taken out the cover.

Direct Line also pointed out that this underinsurance could leave companies drastically out of pocket if they suffer a sudden crisis that would otherwise be covered by the policies.

The firm also found that 32 per cent of smaller firms have public liability insurance, 12 per cent have business interruption cover and 11 per cent have product liability insurance.

Kate Syred, head of Direct Line for Business, said: "With so few businesses being protected from a liability claim, or an unexpected pause in trading, this research highlights the need for business owners to think about specific business insurance.

"Without it, dreams of being a business owner could quickly become a nightmare."

Figures from the firm also suggest that people are far more likely to take out personal home insurance cover than similar insurance for their business.

For example, 82 per cent of business owners were found to have home contents insurance, while only 34 per cent held office contents cover.