Like all businesses, a business that operates a gym will face risks. Some of those risks can be dealt with, but no matter how good you are at what you do and how careful you are, the unexpected can still happen and that can result in your business incurring financial losses.
Gym insurance protects your business when that situation arises. So, what exactly does gym insurance cover, and how much does it cost?
What gym insurance covers
Like many other business insurance policies, gym insurance usually includes property insurance and liability insurance.
Property insurance covers accidental damage to or theft of your business property. This can include the building and its fixtures and fittings. It can also include your equipment, such as office equipment or gym equipment, as well as any stock you hold.
Liability insurance is one of the cornerstone covers of any gym insurance policy. It covers a number of compensation claims that may be made against you. Liability insurance can be broken down into a few key covers.
Employer’s liability insurance is a legal requirement if you employ anyone. It specifically covers compensation claims made against you by your employees.
Public liability insurance is similar to employers’ liability insurance, although it covers compensation claims made against you by members of the public rather than employees.
Products liability insurance also covers compensation claims, but this type of liability insurance covers claims arising from defects in products that you have sold or supplied. It’s usually included with public liability insurance.
Public and products liability insurance usually only covers compensation claims arising from incidents involving either personal injuries or property damage. However, the liability insurance in a good gym insurance policy will include a financial loss extension, which covers compensation claims that result from purely economic losses as well.
Optional extra covers
Depending on your gym’s insurance requirements, your gym insurance can be extended by adding a number of optional extra types of cover. The two main ones are legal expenses insurance and personal accident and sickness insurance.
Legal expenses insurance covers the unexpected legal bills that can arise if you find yourself involved in legal action. The types of legal action that are covered include employment tribunals, legal action following disputes with your neighbours or clients, and the legal defence costs that could be incurred if criminal charges are brought.
Personal accident and sickness insurance replaces your income if you’re unable to work due to an injury or illness, by paying a weekly benefit. If your injury or illness means you will never be able to work, a lump sum is payable.
How much does gym insurance cost?
How much your gym insurance will cost will depend on a number of factors.
The main thing that affects the property insurance cost is the total value of your business property because the more you have, the higher a potential claim could be. The construction of the building and what security you have will also have an impact because they affect the likelihood of a claim.
On the liability insurance side, the employers’ liability cost will be driven by the number of employees that you have or your total wage bill because the more employees you have, the greater the chance of a compensation claim being made against you.
The public and products liability cost will be driven by your annual turnover figure because again, the risk of a claim increases when more people are using your gym. The type of equipment available can also affect the public liability premium because some equipment is more hazardous than other equipment.
Of course, if you have had previous claims this will increase the cost of your gym insurance, so it’s important to do as much as possible to avoid finding yourself in a situation where you have to make a claim.
Obviously buying optional extras will also increase the cost, but not buying them can prove to be a false economy if you find yourself uninsured for a situation like those above where you need to make a claim.