Sole Trader UK: Setup, Tax, NI and Day-to-Day EssentialsBest Business Insurance UK 2026 — Small Business & Self-Employed Compared
Compare the best business insurance providers in the UK for 2026. Public liability, professional indemnity, employer's liability — Hiscox, Simply Business, AXA reviewed.
Business insurance protects you from claims that could otherwise be financially devastating — a single lawsuit from a client or member of the public can cost tens of thousands of pounds. For sole traders and small businesses, the right insurance package depends on your industry, whether you have employees, and what your clients contractually require.
Types of Business Insurance — What Each Covers
| Insurance type | What it covers | Legally required? |
|---|
| Public liability | Injury or property damage to third parties (clients, public) | No (but often contractually required) |
| Professional indemnity | Claims arising from your professional advice or services | Required in some regulated sectors |
| Employers’ liability | Employee injuries or illness arising from work | Yes — if you have employees (min £5M) |
| Product liability | Injury or damage caused by products you sell or make | No (but essential if selling physical products) |
| Business contents | Damage or theft of business equipment | No |
| Cyber insurance | Data breaches, ransomware, cyber attacks | No |
| Key person insurance | Loss of income if a key employee becomes unable to work | No |
Provider Comparison — UK Business Insurance 2026
| Provider | Best for | Public liability from | Professional indemnity from | Online quote |
|---|
| Simply Business | Freelancers, sole traders | ~£50/year | ~£80/year | Yes |
| Hiscox | Professional services, consultants | ~£70/year | ~£90/year | Yes |
| AXA Business | Wider coverage; growing businesses | ~£60/year | ~£100/year | Yes |
| Superscript | Tech, digital, startups | ~£80/year | ~£100/year | Yes |
| PolicyBee | Creative industries, consultants | ~£60/year | ~£90/year | Yes |
| QBE | Medium-sized businesses; complex needs | Varies | Varies | Via broker |
| Zurich | Large businesses | Varies | Varies | Via broker |
| Markel | Professional services; charities | ~£75/year | ~£95/year | Yes |
Premiums are illustrative. Actual cost depends on turnover, industry, claims history, and coverage level.
What Cover Do You Need? — By Business Type
Freelancer / Consultant (sole trader, no employees)
| Cover | Why | Typical cost |
|---|
| Public liability (£1M) | Client contracts; site visits | £50–£120/year |
| Professional indemnity (£500K) | Advice/services risk | £80–£200/year |
| Total | | £130–£320/year |
Tradesperson (sole trader, client premises)
| Cover | Why | Typical cost |
|---|
| Public liability (£2M–£5M) | Physical work risk; client property | £100–£250/year |
| Tools cover | Equipment theft or damage | £80–£150/year |
| Total | | £180–£400/year |
Small limited company with employees
| Cover | Why | Required |
|---|
| Employers’ liability (£5M+) | Legal requirement | Yes |
| Public liability (£2M+) | Client and public claims | Often contractual |
| Professional indemnity | Service liability | If professional services |
| Directors & Officers | Claims against company directors | Recommended |
Worked Example — Freelance IT Consultant
Alex is a freelance IT consultant working with financial services clients. His contracts require £1M public liability and £1M professional indemnity.
| Provider | PL £1M | PI £1M | Annual total |
|---|
| Simply Business | £72 | £108 | £180 |
| Hiscox | £85 | £130 | £215 |
| PolicyBee | £68 | £105 | £173 |
Best option for Alex: PolicyBee or Simply Business at around £170–£180/year for the combined cover his contracts require.
Key Things to Check Before Buying
- Retroactive cover: Professional indemnity should cover work done before the policy starts (claims are often made months or years later)
- Claims-made vs occurrence basis: PI policies are usually claims-made — if you cancel the policy and a claim arises later, you are not covered without run-off cover
- Run-off cover: If you stop trading, buy run-off cover for professional indemnity claims that may still arise
- Minimum coverage level: Check your client contracts — many specify minimum public liability (often £2M–£5M) and PI amounts
- Exclusions: Some policies exclude specific activities — ensure your actual work is covered
Where to Buy Business Insurance
- Directly from insurers: Hiscox and AXA have strong direct channels
- Comparison platforms: Simply Business (comparison-focused), PolicyBee (specialist freelancer focus)
- Through a broker: Best for complex or high-value needs — brokers can access the whole market
For more on running a business see self-employment guide, business expenses you can claim, and best accounting software UK.