Research commissioned by AXA Insurance in association with the British
Chambers of Commerce (BCC) reveals that over half a million people are uninsured in their workplace and a third of businesses (34%) understand their legal requirement to cover employees through employers’ liability insurance.

Alongside this, a worrying number of businesses are looking to reduce
or cut out insurance cover altogether as the recession bites. In the last year,
around 15% have considered cutting back on their insurance while five per cent
have already cut back their level of insurance cover. When it comes to making
cuts to save money, reducing the level of insurance cover is almost as likely
to be a target as the company’s tea and coffee (with 35% and 39% respectively).

However,AXA warns this is a dangerous false economy as 13% of businesses have less than
£1,000 disposable cash and 48% have less than £10,000. This means that without
proper insurance, companies would be left extremely vulnerable in the event of
a claim which around one in nine businesses are likely to make each year. Average claims costs for the three most common claims are around £49k for business interruption, £36k for fire and £3.5k for theft.

The research carried out among hundreds of British businesses across all sectors
shows that ignorance is rife. Aside from nearly two thirds not understanding
their legal obligations in relation to employers’ liability cover, only 11% of
employers understand that if a company van or other vehicle is made available
to employees then the employer is legally obliged to insure it. Only 37%
understand completely what premises insurance is for while this figure drops to
26% for equipment and contents and 30% for public liability.