Business insurance for start-ups in Switzerland: a guide for founders
Building a successful start-up requires more than just an innovative idea and entrepreneurial spirit. An essential but often neglected aspect is the right insurance cover. Business insurance protects you and your company against financial risks that can arise from unforeseen events. Whether it's liability, property insurance or protection for your employees - there are a variety of insurance policies for start-ups in Switzerland that you should be aware of. In this blog post, we'll give you an overview of the most important business insurance policies and help you find the right cover for your business.
Why is business insurance important?
Business insurance protects you against the financial consequences of risks such as damage, legal disputes or defaults. They are particularly important because many start-ups have limited financial resources and an unforeseen event can quickly threaten their existence. The right insurance cover protects your company and gives you the security you need to focus on growth.
Advantages of business insurance:
- Protection against financial losses due to claims for damages or unforeseen events
- Legal protection in the event of liability or disputes
- Strengthening the trust of customers, investors and business partners
- Risk minimizationto be able to grow undisturbed
Important business insurance for start-ups in Switzerland
Depending on the industry and business model, different types of insurance are required. Here are the most important insurances that are relevant for start-ups in Switzerland:
Public liability insurance
The public liability insurance protects your company against claims for damages made by third parties, e.g. customers or business partners. It covers personal injury and property damage as well as any resulting financial losses.
Examples:
- A customer injures himself in your office and demands compensation.
- You cause damage to a customer's property during a business meeting by accident.
Why you need it: Without public liability insurance, high claims can quickly lead to financial ruin. This insurance is particularly important for start-ups as it covers a wide range of risks.
Professional liability insurance
The professional liability insurance insures you against financial losses caused by errors in the performance of your professional activities. This insurance is particularly relevant for advisory and service-providing professions such as lawyers, consultants or IT service providers.
Examples:
- You give a customer the wrong advice, causing him financial loss.
- An error in the software you have developed for a customer leads to a business interruption and thus to high costs.
Why you need it: This insurance protects you against the financial consequences of professional mistakes that could have a significant impact on your clients.
Property insurance
One property insurance protects your company's physical assets, such as office furniture, technical equipment and machinery, against damage caused by fire, water, burglary or natural disasters.
Examples:
- A fire destroys the office and all the office equipment.
- Expensive IT equipment is stolen after a break-in.
Why you need it: Property insurance protects your business inventory so that you are not stuck with high costs if damage occurs.
Legal expenses insurance
The legal expenses insurance provides you with financial support in the event of legal disputes. It covers the costs of lawyers, court proceedings and legal advice.
Examples:
- A customer sues you for non-fulfillment of a contract.
- You have a dispute with an employee that ends up in court.
Why you need it: Legal disputes can be expensive and time-consuming. Legal expenses insurance protects you from the high costs of legal proceedings.
Business interruption insurance
The business interruption insurance covers the financial loss caused by an interruption to business operations, e.g. due to fire or water damage. It replaces lost profits and helps to continue paying running costs such as salaries.
Examples:
- Your office is rendered unusable by a fire and you have to shut down operations for several weeks.
- Water damage destroys your production machinery, causing production to stop.
Why you need it: A prolonged business interruption can threaten the existence of a startup. This insurance ensures that your company remains solvent even in difficult times.
Personal insurance (accident, illness, BVG)
For companies that employ staff accident and daily sickness benefits insurance and the occupational benefits (BVG) are required by law. Accident insurance protects employees in the event of occupational accidents and illnesses as well as non-occupational accidents. The BVG provides retirement benefits for employees.
Why you need it: These insurances are required by law and ensure that your employees are well covered.
Here is a table summarizing the most important business insurances:
| Insurance | What is covered? | Examples of risks | Why you need them | Estimated costs (annual) |
|---|---|---|---|---|
| Public liability insurance | Protection against claims for damages by third parties in the event of personal injury and property damage | Customer injured in the office, damage to the customer's property | Prevents claims for damages that threaten the existence of the company | 500 - 2'000 CHF |
| Professional liability insurance | Insurance against financial losses caused by professional errors | Incorrect advice, software errors cause financial losses for customers | Indispensable for consulting professions and service providers | From CHF 1,000 |
| Property insurance | Protection of business assets such as office furniture, IT equipment, machinery against damage caused by fire, water, burglary, etc. | Fire destroys office inventory, IT equipment is stolen | Ensuring continued operation by covering damage to operating equipment | Several hundred to thousand CHF |
| Legal protection insurance | Assumption of legal fees and court costs in the event of legal disputes | Disputes with customers, suppliers or employees | Protects against high costs in the event of legal disputes | From 500 CHF |
| Business interruption insurance | Compensation for loss of income in the event of business downtime, e.g. due to fire or water damage | Office fire leads to interruption of business operations, machine breakdown in production | Safeguards against loss of income and ongoing costs to maintain liquidity | From 500 CHF |
| Personal insurance (accident, BVG) | Insurance cover for employees in the event of accidents and illness as well as pension cover | Accident of an employee at work, illness leads to continued payment of wages | Required by law for companies with employees; protects employees and employers equallyssen | 6-12 % of the gross salary |
Which insurance policies are really necessary for your startup?
Not every insurance is necessary for every startup. Which insurance you need depends on various factors:
- IndustryCompanies in high-risk sectors such as construction, IT or consulting require specific insurance such as professional indemnity or construction insurance.
- Size of the companySmaller start-ups with few employees often get by with public liability and the legally required insurances.
- Business modelIf you sell physical products, property insurance makes sense. Consulting professions, on the other hand, should invest in professional liability insurance.
Practical tip: Get in touch with an insurance expert to create a customized risk analysis for your company.
How much does business insurance cost?
The cost of insurance depends on various factors, including the industry, the number of employees, the turnover and the scope of insurance. Here is a rough overview:
- Public liabilityDepending on the sector and scope of cover, between CHF 500 and CHF 2,000 per year.
- Professional liabilityFor advisory professions from CHF 1,000 per year, depending on the risk of the activity.
- Property insuranceThe premiums vary depending on the value of the inventory and usually amount to several hundred to several thousand CHF per year.
- Legal protection insuranceCosts from CHF 500 per year, depending on the scope of benefits.
- Business interruption insuranceDepending on the sector and size of business, from CHF 500 per year.
- Personal insurance (accident, BVG): Contributions are based on the employees' salaries and amount to approx. 6-12 % of the gross salary.
How do you find the right insurance for your startup?
Choosing the right insurance can be a challenge, as there are many options and every company has individual needs. Here are some steps that can help you:
Carry out a risk assessment
Conduct a thorough analysis of the potential risks in your company. What damage could have particularly serious consequences? What liability risks exist?
Advice from experts
Talk to an independent insurance broker or consultant who can help you find the right insurance policies. They often have access to different insurance providers and can recommend customized solutions for your startup.
Carry out insurance comparisons
It's worth getting several quotes from different providers to find the best conditions. Pay attention not only to the price, but also to the scope of cover and the quality of service.
Conclusion: business insurance as protection for your startup
Insurance is an essential part of any solid business strategy. It protects you and your startup from the financial consequences of unforeseen events and gives you the security you need to focus on growing your business. By choosing the right insurance, you can minimize risks and build your startup successfully in the long term.
