Insurance allows us to minimise risk, or to spread risk around. In this way, they can shape our behaviour, encouraging us to do certain things while discouraging us from doing others. If we stood to lose everything if our business premises were to burn down, the chances are that we'd avoid opening a business in the first place.
It's only in certain cases that we're legally obliged to insure ourselves against specific kinds of risk. These tend to involve business insurance and car insurance. In some cases, it might be advisable to forgo insurance – but we must do so while being aware of the risks, and the potential legal ramifications.
While some kinds of fancy insurance might be advisable, there is a bare minimum in both business and motoring, and it's worth being aware of it.
What does the law say about driving uninsured?
In the UK, it's a legal requirement that all drivers on public roads be insured. This means, at the very least, third-party insurance (which protects other motorists and pedestrians against risk caused by your presence on the road.
Uninsured drivers risk being issued with a fine of £300, along with six points on their license. Those are the fixed-penalty consequences. If the case goes to court, then the fine is unlimited, and you might receive a ban. The police might also seize and destroy the vehicle in question.
If you're just going to be on the road for a limited time, perhaps to learn to drive, then you might opt for specialised insurance. Temporary car insurance will ensure that you're covered.
The Importance of Employer Liability Insurance
As soon as you become an employer, you're obliged to seek out Employer's Liability Insurance. This is what will protect you against harm suffered by your employees. So, if your employee suffers an injury because of their work, you'll be protected.
This must come from an authorised body and payout for at least £5 million in damages. This doesn't apply if you're only employing family members or people based overseas. You can see whether an insurer is approved by checking the Financial Conduct Authority's database.
If you're not insured in this way, you could be fined £2,500 a day. Moreover, you're at risk of an on-the-spot fine of £1,000 if your certificate is not available when inspectors ask for it.
Civil Law Claims
Cases between persons or between individuals and organisations are the foundation of civil law. Crimes against another person, their rights, or their property are considered breaches of civil law.
The party making the claim is referred to as the "claimant" in civil law. The "defendant" is the individual who is being accused. Establishing whether the defendant owed the claimant a duty of care is usually at the heart of these instances.
Employers are also vulnerable to claims brought by employees or members of the public who have been injured or made ill as a result of your actions as an employer. Your insurer can provide you with advice about how you might contend with claims of this kind, and guard against risk.
