What Kind Of Insurance Is Needed For A Commercial Cleaning Business
When thinking of how to start a commercial cleaning business from scratch, you may have built up a plan, a number of tools and equipment, and a service team. These are all crucial aspects of your daily work. And insurance has a place there too. It could spell disaster for your commercial cleaning business if it isn’t given the same priority.
So what are the demands of commercial insurance? Why does it matter, and what do you need? Rainbow International has some thoughts on providing your cleaning organisation with this security, either as a franchise or independent brand.
Why do you need insurance cover?
Cleaning tasks can take place anywhere. From offices and schools to factories, these spaces are full of hazards – many of which your cleaning franchise won’t be familiar with at first. Something could go wrong. A trip, spill or electrical malfunction can cause injury – either to your workers or those who occupy the premises. Chemicals are a concern too: those you use, and others you might run into on the job. Insurance is an important part of commercial work in general, but it’s especially vital for cleaners.
Some insurance is legally required, so if you don’t have it in place, the implications could be considerable. Even with insurances that don’t fall under your legal obligations, the potential impact of being without them could result in disaster for your commercial cleaning business. Damages, compensation, health bills, and an irreversible blow to your reputation are all potential occurrences.
Insurance isn’t a ‘maybe’ on your shopping list – it’s a necessity. Let’s move on to the types of insurance you should be looking at…
Common insurance for cleaning businesses
Upon setting up a commercial cleaning business, it’s imperative to seek the right sort of cover before you start trading.
- Public liability: It doesn’t matter what you specialise in – everyone needs public liability insurance. Injury and tarnished property are both part of the agreement – whether a damp patch has been left on the floor, which a person blames for falling and hurting themselves, or a critical industrial machine has been damaged during your assignment. Since moisture, cleaning agents and physical activity are critical to the role, it’s absolutely necessary for your business. Public liability tends to start from £1m; big clients, such as schools and hospitals, may ask for higher figures before taking you on. The maximum you can be covered for, generally speaking, is £10m.
- Employer’s liability: Another universal insurance demand, employer’s liability protects those who work for you, in case they’re hurt or suffer from a contamination. Often, underwriters will look at your best practices to determine how well you minimise risk. Staff may sue for injury if anything goes wrong due to a fault in training, preparation or tools. Aside from the risks encountered on a job, you can count on protection for your own premises too – any loose cables or wall fittings, weak points in hygiene, or anything else that may cause harm. As long as you have staff, it’s a legal requirement.
- Loss of keys: You may not initially class this as a large concern. Yet when we consider it, losing a client’s key can be extremely costly. Imagine a large enterprise: a lab, say, or an industrial facility with dozens of doors and exits. When a single key vanishes, the whole system is compromised. Clients are bound to change their locks, and charge you for the inconvenience.
- Cleaning carpets, rugs or upholstery: This may form part of your public liability cover, but it is always worth checking the small print to be sure. Commercial cleaners use steamers and other technology to rid carpets, for instance, of stains, dirt and mildew. That same steam can escape into other aspects of the space, ruining items or causing terminal disintegration over time. Likewise, you should check the insurance for sofas, chairs, rugs and curtains. That’ll come into play quite extensively if you’re treating a historic home, which has to be maintained not only for business but cultural value.
- Commercial motor: It’s tough to avoid eventually using vehicles for your cleaning business if you want to extend your reach and range of customers. Every one of our Rainbow franchise owners manages a fleet of vehicles. And whether these are cars or vans, one thing remains universal – commercial motor cover. There are three levels:
- ‘Third party’ accident protection
- Added fire non-liability
- ‘Comprehensive’ insurance.
Cutting to the cost
Listing the insurance you’ll need is straightforward. However, there are far more variables in the price you’ll pay for a suitable package for your business.
Some insurers will lump related cover together – public liability with upholstery damage, for instance. Others will help you select and match individual policies. By shopping around, you’ll get a better deal.
For an idea of the costs you should be aiming for, based on industry averages, here are some tips:
- According to AXA, public liability insurance is around £119 per annum (as of 2018). 10% of AXA’s customers agreed to £59 this year. But, based on the nature of commercial cleaning, you’ll be looking to the upper end of the spectrum.
- Fleet cover is more difficult to gauge. Dependencies include the age of the driver, their competence on the road, whether they’ve had violations in the past, and whether you’re using a safe, modern vehicle. But you can limit the price by sending your team on a safety awareness course and reviewing their skills every six months or so. Telematics software is also good for proving their aversion to risk. Check out Fleet News for more advice.
- The more staff you have, the greater your employer’s liability will be. Average costs hit £40-60 annually for sole traders and small businesses. That increases to £135 for ‘experienced tradesmen’. As a specialist cleaner, you’ll probably find yourself somewhere in the middle at £90-100. Expect to face a bigger price tag when your team count grows by two or three.
The final pair of insurance types (lost keys and upholstery cover) will be extended to the indemnity product, if you ask for it. It’s always wise to read your contract with care to see if this will be a small extra fee, or if it comes as standard.
Seek the guidance of an established brand
By learning why insurance is necessary, and the forms it can arrive in, you’ll be much better prepared as a cleaning franchise – and you can set to rest your worries over your staff, their trust and what may go awry.
In our mind, that’s a brilliant reason to choose a franchise with a reputable business, like Rainbow International. You aren’t heading into this sector on your own. Commercial premises can come in all shapes and sizes – and our guidance can give you the confidence to lead a strong, profitable venture.
Book a call with us today to find out more about our cleaning franchise opportunities by heading to our Next Steps page.