Liability Insurance: The Non-Negotiable for Workshop Operations - ACT and Bikmo
Posted on in Business News , Cycles News
For most cycling businesses operating a workshop, public and products liability isn't optional. It's critical. Joanna Evans, Head of Bikmo for Business, explains in the next installment of a series of articles.
Let's talk about liability insurance. This is where things get serious.
For most cycling businesses operating a workshop, public and products liability isn't optional. It's critical.
It's Not Just About Having Cover
It's about having enough cover because the severity and potential cost of these claims can be enormous.
Picture this: your mechanic completes a service but misses a dodgy cable. A few days later, the brakes fail on a big descent. Your customer crashes and someone’s worst nightmare becomes your responsibility.
These aren't scenarios dreamed up by insurers to scare your premiums up. They're very real possibilities when you're working on bikes. Claims can easily run into millions when you factor in long-term care, loss of earnings, and legal fees.
How Much Cover Do You Actually Need?
For a basic retail operation with your typical risks like slips, trips, falling stock, or accidentally damaging customer property? £2 million is generally reasonable.
Operating a workshop or offering maintenance services? You're in a higher risk category. For workshop operations, £5 million is where you need to be, if not £10 million.
Offering multiple services like guiding or touring, maintenance classes, and events? Think about your overall exposure across all those activities. £5 million is a good starting point.
Public or Product? What does it mean?
- Public Liability Insurance pays out if a Customer injures themselves in your shop or if you damage any customer property left in your care. You’re also covered if anyone injures themselves during any events or group rides you organise.
- Products Liability Insurance protects you if a customer is injured or their property damaged after issues relating to a bike you assembled or worked on. There’s a bit more to it than that, but you get the idea.
Workshop Operations: Where the Real Risk Lives
Operating a workshop means taking on significant responsibility. Every service, every adjustment, every component you fit becomes your responsibility. A simple mistake can have catastrophic consequences.
Workshop operations need higher levels of cover because you're not just selling products. You're directly responsible for the safety and function of every bike that leaves your shop.
Don't Underestimate Your Exposure
Consider everything you do. How many bikes do you service each month? What's the most complex work you undertake? Do you work on e-bikes with their higher speeds and weights? Do you organise group rides or events?
Each factor contributes to your overall risk profile. Having adequate liability cover means you can sleep at night knowing that if the worst happens, your business and personal assets are protected.
The message is simple: if you're operating a workshop or offering maintenance services, liability insurance isn't something to economise on. It's the foundation that allows you to operate with confidence.