Must-have insurance policies for cleaning businesses

RECENT STATISTICS have revealed that the UK cleaning industry generates more than £23.5billion each year, yet worrying figures show that 44% of all SMEs have no commercial insurance - potentially risking these profits. 

So what types of insurance policies do cleaning businesses need to protect themselves and their revenue?  

Navigating business insurance can be complex, especially for businesses operating within cleaning niches like residential cleaning, commercial cleaning, and services like residential clearance or laundry assistance. 

Each niche has unique risks and requirements, making specific insurance policies essential to protect the business, its employees, and its clients. Here's a breakdown of some of the key types of business insurance needed for cleaning businesses and what these policies typically cover:

Public liability insurance

• Protects against claims of bodily injury or property damage caused to third parties by your business operations. For instance, if a client trips over cleaning equipment and gets injured, this insurance can cover the compensation costs

• Fundamental cover for all cleaning businesses to safeguard against common risks encountered during cleaning jobs.

Professional indemnity insurance

• Offers protection against claims of negligence, breach of duty, or failure to deliver services as promised. This can include damages or losses a client suffers due to mistakes or oversights by your cleaning business

• Essential for defending against claims where the service didn’t meet client expectations or contractual obligations.

Employers' liability insurance

• Compulsory for any UK business that employs staff, covering claims from employees who get injured or ill due to their work. This includes direct employees and contract workers, depending on the contract terms

• It’s legally required for businesses with staff (that aren’t family members) in the UK, with fines for businesses that don’t have a policy in place.

Commercial property insurance

• Protects the physical assets of your business, such as cleaning equipment, office spaces, and storage facilities, against damage or loss from fires, floods, theft, and other risks

• Critical for protecting the capital investments made into your cleaning business.

Commercial vehicle insurance

• Covers damage to or caused by vehicles used for business purposes. This is beyond standard personal vehicle insurance and is required for any vehicle used for work activities

• Legally required for vehicles in the UK, ensuring that accidents involving business vehicles don’t lead to unmanageable financial losses.

Business interruption insurance

• Provides financial support if your business operations are halted due to unexpected events like fires, floods, or significant equipment breakdowns. It can help cover lost income and operating expenses during the downtime

• Helps maintain financial stability and continuity of operations during unforeseen disruptions.

Specialised coverages

• Cyber liability insurance: Important for businesses that handle customer data electronically. It protects against losses from data breaches or cyberattacks

• Pollution liability insurance: This may be necessary for niches dealing with hazardous materials, covering claims related to environmental damage caused by your business’s activities.

Selecting the right insurance coverage is crucial for mitigating the unique risks associated with the cleaning industry. It’s advisable to consult with an insurance broker experienced in the cleaning industry to tailor the insurance coverage to your business needs. 

Not only does having the appropriate insurance protect your business financially, but it also enhances your reputation, showing clients and employees that you’re responsible and professional.

Kyle Eaton is an expert adviser at money.co.uk business insurance.

For more information, visit www.money.co.uk/business/business-insurance