It is easier than ever for people to set up their own businesses. With the internet, having a physical presence such as a shop or office is no longer necessary in order to run a successful business.
However, the insurance market hasn’t moved on as quick when it comes to insuring those businesses, particularly an online business. There are still a large number of insurers, mainly household names, that refuse to insure online businesses, and most lack products designed for online shops. The reasons for this include the international implications of selling products online, particularly to USA and Canada. Online retailers also often sell products that are imported from outside countries that are in the EU, making liability very difficult to trace. This makes these businesses high risk to insurers.
The insurers require quite a lot of information wanting to know both what you do and how you do it as well as where you source your stock from and who your potential market is. So, if you sell toys on-line, you cannot describe yourself as just a toy retailer – you would also have to inform the insurer that you do this online whether exclusively or just partially.
Should some of your sales take place offline, then this should make it much easier to get a quote. If you are predominantly an online business retailer, but even a small amount of your turnover is generated from offline sales, I would recommend using a broker to source this insurance for you. Online quotation engines will not ask you the right questions and make a number of assumptions that would not be relevant for online businesses. A broker can make sure your online business is fully covered for the risks it faces.
At TI Accountancy, we have experience of sourcing policies for many online businesses and will be able to make this process far easier and lot less frustrating.