Insurance claim against me: how does it work?

No business owner wants to find out that a claim has been filed against them or their company. Even if the claim is because of an accident, businesses can still be liable for minor incidents, and the reality of a claim against you can be scary. But fear not, this article will look at the claims process and how it works if your business is notified of a legal claim against you.

We’ll look at the following areas:

• Receiving notification of the claim
• Contact your insurance or solicitor
• Understanding the type of claim
• Legal options

Usually, the first step of a claim against your business will be that you receive a letter. Then, depending on the nature of the incident that has caused the claim, you’ll receive a Letter of Claim or a Claim Notification Form. These documents will have details of the alleged incident or accident. 

The first rule to abide by in this situation is do not ignore the letter. You have 14 days from receiving the letter to acknowledge the claim and then 28 days from the date you received the notification to submit your defence.

If you ignore the solicitor’s notification letter, it will likely be counted against you in the legal judgment. Dealing with the claim notification quickly and efficiently is the wisest thing to do. In general, the faster you seek legal help and deal with the claim, the more likely it is to be resolved fairly and reduce the costs you’ll pay for legal fees.

So the next step is to get in touch with professionals to support your case. In the first instance, you should contact a solicitor to run through the claim and understand your legal options.

Depending on the type of incident the claim is based on, you may have insurance that will already cover a claim and the associated fees. You should then get in touch with the insurance company to ensure that your policy covers the claim, and the insurer should be able to help you navigate the next steps.

If you do not tell the insurer quickly, they may find you in breach of your policy conditions, so tell them as soon as you find out about the claim proceedings. 

If you do not have insurance, then find a solicitor as soon as possible. Though legal fees can be expensive, don’t let that put you off. Quite often, solicitors will offer a free or discounted initial consultation so you can understand what will happen and what options are available to you. Involving a legal professional early on will also help you deal with the stress of a claim and allow you to continue running your business while the lawyer deals with the situation.

There are various types of claims that might happen to your business, so we’ll look at the most common:

If your business vehicle was involved in an accident (even just a minor bump), you should always speak to the car insurer to find out what is not covered by the policy. Third-party motor insurance is the legal minimum in the UK to drive a car on the road, so even a basic policy should cover an accident claim. Generally, you shouldn’t need a solicitor for this claim, and the insurer can resolve the claim.

Suppose you do not have insurance, or your insurance company refuses to cover you (for example, the policy details were incorrect or expired). In that case, you can contact the Motor Insurance Bureau that handles uninsured and untraced driver claims.

Public liability insurance is not a legal requirement. But, many businesses still have a policy in case of accidents with a member of the public while carrying out your business activities. 

For example, if you are a hairdresser and a customer slipped on some hair or water at your salon, they would have a valid claim. The compensation for injury, inconvenience, or to repair/replace damaged property could be in the tens of thousands, which could be a devastating loss to a small business. 

If this type of claim is levied against you, you can contact the insurer directly, and if you don’t have insurance, speak to a solicitor or legal defence lawyer as soon as possible.

An employer’s liability insurance policy works the same way as public liability, except it covers you for any claims for someone you’ve employed who was hurt while working for you. 

Again, if you have a policy (and it is a legal requirement if you have employees or employ someone on a casual basis), contact the insurer first. If you do not, get in touch with a legal professional to find out your options.

Every claim will be different, but once you have met with a legal professional, they will advise you of the options available to you, depending on the circumstances of the incident. They may advise you:

• It is worth going to court for a fair settlement if you have reason to believe the claim is not valid.
• To make a counterclaim, if you believe the other person caused the incident.
• To settle out of court through a settlement payment or other means.

You would then become the defendant if the claim went to court. 

To avoid having a legal battle as well as the costs associated with that, you can protect your business against claims to the best of your ability with robust insurance policies. To bring five-star Trustpilot-rated cover to small businesses like yours, we’ve partnered with insurance provider Superscript. Click here to get a quote in minutes.