Business insurance can cover a wide range of disasters, such as being sued (e.g., for illness, injury, property damage or negligence) or certain types of loss (e.g., flood, fire, theft, cyberattack and more). If your business experiences one of these disasters, you may need to claim on your business insurance. What can you claim on your business insurance, and how do you go about it? We'll explain the ins and outs so you know what to do.
How to Claim on Business Insurance
To initiate a business insurance claim, you need to contact your insurer and follow their rules to ensure that your claim is paid. While the steps can vary by insurer or situation, you'll generally need to do the following to make a business insurance claim:
- Call the insurer's claims number—you can find this in your policy documents or online.
- Explain what has happened and what loss or damage you are claiming for.
- You may need to complete a claims form in addition to disclosing the details over the phone—this varies by insurer and situation.
- Ask for and follow advice from your insurer to limit damage.
- Inquire about your excess.
- Check your policy documents to confirm timing deadlines or any requirements of claiming.
- Send any paperwork that is required as proof of the claim, such as photos or repair estimates.
- In the case of damage, you may need to meet with an assessor who will check any damage in person and review the claim details.
If your claim is related to theft or vandalism, be sure that you also file a report with your local police station as soon as possible. You'll typically need to submit the incident number as supporting proof for your claim.
What Claims Are Covered?
There are many different types of business insurance, so each policy is unique. Check the terms of your policy to find out what types of cover you have and, therefore, what you claim for, which can include:
- Public liability claims: Business-related injury to a third party or damage to their property
- Employers' liability claims: Work-related employee injury or illness
- Professional indemnity claims: Negligent advice, design or service of a professional nature
- Cyber attack: Cyber crimes and data breaches
- Building claims: Damage to the building (e.g., walls, doors, windows, plumbing, electrics, etc.)
- Content claims: Damaged or stolen contents (e.g., furniture or furnishings, white goods, carpets, window coverings, stock, etc.)
- and more
You should check the terms of your policy to understand what is covered and what is excluded. For example, a property left unoccupied for over 60 days might not be covered.
Common Reasons a Business Insurance Claim Might be Refused
If you don't adhere to the terms of your business insurance policy or if a claim is not covered, your claim might be refused. Here are some reasons that your insurer might not pay your business insurance claim.
- The cause of damage is not covered by or specifically excluded from your policy.
- The claim was not filed in a timely manner (e.g., within 24 hours, as dictated by your policy documents).
- You gave incorrect information when bought your policy or made your claim.
- You did not inform your insurer of changes to your circumstances or changes in tenancy or occupation at the property (e.g., the property was unoccupied during renovation work).
- You haven't complied with the conditions of your policy.
- In the case of buildings and contents, a claim for damage caused by general wear and tear (e.g., a leak due to deterioration of an aging roof).
- In the case of buildings and contents, a claim for damage resulting from lack of maintenance or failure to keep the property in a good state of repair.
- You have not tried to prevent further damage (e.g., collecting water from a roof leak in a bucket, taking action to limit a cyber attack, etc.).
If you feel your insurer has unjustly refused a business insurance claim, you can make a complaint to the Financial Ombudsman Service (FOS) here. Before doing this, however, you're meant to first make a complaint to your insurer and give them 8 weeks to respond. If you're uncertain about how to let them know what's wrong and how you'd like things put right, you can also contact the FOS for guidance. When making a complaint with the FOS, in most cases you'll need to do so within 6 months of receiving the business’s final response to your complaint.
Inform Your Insurer of Changes
To help avoid falling foul of one of the most common reasons for a business insurance claim to be denied, be sure to let your insurer know if there's a change to your business or your circumstances. Be aware that you may need to pay a higher premium as a result of certain changes. For example, employers' liability insurance is priced based on the number of employees, so a new hire might affect your premium. This is not an exhaustive list, but here are some examples of changes that you should inform your insurer of:
- Change in the number of employees
- Change in the type of work you do or your clientele
- Change in expected turnover
- Change in the rebuild value of a property
- Change to the value of the contents (e.g., if you buy new white goods or install a new carpet)
- Change to your marital status or contact details
- Building works or renovations (e.g., a new bathroom or loft extension)