Business insurance in Cyprus in 2024. Affordable business insurance in Cyprus.

Business Insurance in Cyprus: A Comprehensive Guide

Business insurance, also known as commercial insurance, is essential for safeguarding your company against unexpected events and financial losses. This guide will help you navigate the various types of business insurance available in Cyprus, detailing the coverage each type offers. We’ll also provide tips on reducing insurance costs by comparing the most affordable business insurance contracts in Cyprus.

Table of Contents

1. What is Business Insurance?
2. Business Insurance Coverages
3. How Much is Business Insurance in Cyprus?
4. Affordable Business Insurance
5. Small Business Insurance in Cyprus
6. Online Business Insurance Cyprus
7. Business Insurance Quotes in Cyprus

What is Business Insurance?

Business insurance, or commercial insurance, is designed to protect business owners from unexpected losses. It covers risks such as accidents, theft, property damage, professional errors, and cyber attacks. Additionally, it can help with lawsuits and cover injured employees’ lost wages, providing access to programs that facilitate their return to work.

A traditional business insurance policy in Cyprus, also known as a business owners policy (BOP), typically includes a combination of the following coverages:

• Public Liability
• Business Property Insurance
• Employers Liability Insurance

However, business insurance is a broad term encompassing various coverages, such as:

• Product Liability
• Commercial Car Insurance
• Business Interruption Insurance
• Professional Indemnity Insurance
• Directors and Officers Insurance
• Cyber Insurance
• Group Health Insurance

Business Insurance Coverages

Business Property Insurance in Cyprus

Also known as commercial property insurance or business hazard insurance, this coverage protects your rented or owned building, as well as the tools and equipment used to operate your business. It covers losses from:

• Earthquake
• Fire
• Burglary
• Theft
• Wind
• Lightning

Commercial property insurance helps protect physical business assets, including:

• Building
• Equipment
• Tools
• Inventory
• Furniture
• Personal Property

To ensure adequate coverage, compile a list of all valuable items in your office, such as computers, laptops, servers, and printers. Update this list annually and provide it to your insurance company. If you own your company’s building, include the reconstruction value of your property, which is the cost to replace or rebuild it to original or similar standards considering current material and labor costs. Our engineers can assist in calculating this value (contact: [email protected]).

Read more about business property insurance in Cyprus.

Commercial Car Insurance in Cyprus

This insurance covers costs related to accidents involving company-owned vehicles, including medical expenses and property damage. It also covers employees using company cars. There are three main types of coverage for private vehicles:

• Third-Party
• Third-Party, Fire, and Theft
• Full or Comprehensive Car Insurance

Comprehensive commercial car insurance includes:

• Property Damage Liability Coverage: Covers damage to someone else’s property.
• Bodily Injury Liability Coverage: Covers another party’s injuries and medical expenses.
• Collision Coverage: Pays for repairs or replacements if your vehicle is damaged in an accident.
• Personal Injury Protection (PIP): Covers bodily injury, medical expenses, and funeral costs regardless of fault.
• Uninsured/Underinsured Motorist Coverage: Pays for damages and medical expenses if the other driver lacks adequate coverage.

Commercial car insurance typically excludes:

• Damaged contents inside the business vehicle during an accident.
• Accidents when an employee is using their vehicle for personal purposes.
• Non-accident-related medical expenses.
• Repairs to a rental vehicle used while the commercial vehicle is being fixed.

Commercial car insurance covers various vehicles, including:

• Cars
• Vans
• Trucks
• Utility Trucks

Learn more about commercial car insurance in Cyprus.

By understanding the different types of business insurance available and ensuring your business is adequately covered, you can protect your company from significant financial losses and ensure its long-term stability.

Employers Liability Insurance in Cyprus

Employers liability insurance is crucial for business owners in Cyprus to safeguard against legal issues arising from employee work-related injury or illness claims. It’s important to distinguish employers liability insurance from workers compensation insurance: while workers compensation primarily covers employees’ medical expenses, employers liability insurance helps pay for legal costs associated with these claims.

How Does Employers Liability Insurance Work?

Employers liability insurance covers expenses and legal fees related to employee work-related illnesses or injuries if the employer is sued. This coverage ensures that businesses are financially protected from employee claims. It can be purchased separately or as part of a comprehensive business insurance package, which might include business interruption, property, general public, and product liability insurance.

Coverage of Employers Liability Insurance in Cyprus

This insurance covers an employer’s liability for errors or negligent acts, providing compensation to employees (or their families) for personal injury or death caused by workplace accidents or occupational diseases. In Cyprus, employers liability insurance is mandatory and regulated by Law 174/1989. The minimum liability limits are:

• For each accident or disease concerning each employee: €160,000
• For each incident or series of incidents arising from the same cause: €3,415,000
• For each insurance period: €5,125,000

Failing to carry employers liability insurance in Cyprus is a criminal offense, punishable by up to one year in prison, a fine up to €5,000, or both. Additionally, employers must display the Certificate of Employers Liability Insurance prominently at their headquarters or face a €3,000 penalty. The Cyprus Institute of Legal Information (CyLII) regulates this insurance and provides detailed information on their online portal.

Learn more about employers liability insurance in Cyprus.

General Public Liability Insurance in Cyprus

Many companies in Cyprus are contractually required to have comprehensive business insurance, including general public liability and professional indemnity insurance, especially when dealing with large international firms. Technology sector companies might also need multimedia and cyber insurance.

What is General Public Liability Insurance?

General public liability insurance, or business liability insurance, protects businesses against claims made by the public, including clients and visitors. It covers medical expenses and other fees resulting from injuries, death, and property damage related to the business. This insurance covers claims regardless of where the incident occurred, inside or outside the company’s premises.

In the EU and the USA, this type of insurance is often part of an umbrella contract known as a “business insurance contract” or “business owners contract,” which typically includes:

• Product liability insurance
• Employers liability insurance
• General public liability insurance
• Contents and premises insurance

General Public Liability Insurance Coverages

The core of general public liability insurance is premises liability insurance, covering incidents within the company’s premises, such as shops, offices, or factories. In Cyprus, premises liability insurance is usually part of a business owners contract or an additional coverage on a standard employers liability insurance contract. It is rarely sold separately.

Extending Coverage

In Cyprus, businesses can extend their premises liability coverage to general public liability coverage, which includes incidents occurring both inside and outside the premises. However, the company’s activities will be carefully assessed before granting this extension.

Exclusions from Public Liability Insurance

Standard public liability insurance typically does not cover:

• Employee injuries while working (covered under employers liability insurance)
• Professional errors and negligence (covered by professional indemnity insurance)
• Cyber risks and professional mistakes related to company services (covered by cyber insurance)

Public Liability vs. General Liability Insurance

Public liability insurance covers incidents within the company’s premises, while general public liability insurance also covers incidents outside the premises. Some policies may include product liability insurance.

Examples of Public Liability Claims

Common incidents resulting in public liability claims include:

• Defective product issues
• Falling and faulty objects
• Building and construction claims
• Slips, trips, and falls

Business Interruption Insurance in Cyprus

Without appropriate insurance, companies face significant financial risks, making business interruption insurance essential for most business owners. Also known as business income insurance or contingent business interruption coverage, this type of insurance is typically included as part of a commercial property insurance policy.

How Does Business Interruption Insurance Work?

Business interruption insurance provides financial support to business owners when their operations are disrupted. This insurance helps replace lost income if your business temporarily closes due to a covered loss, such as property damage requiring repairs. It ensures that your business remains financially stable while your premises are being repaired.

Business owner policies (BOP) often include business interruption insurance alongside other coverages like general liability insurance, commercial property insurance, and data breach insurance.

What Does Business Interruption Insurance Cover?

Business interruption insurance can cover your company’s operating expenses if a covered loss forces you to close your business. These expenses typically include:

• Employee wages: Ensuring your employees continue to receive their salaries.
• Taxes: Covering your tax obligations, whether monthly or quarterly.
• Loan payments: Paying scheduled loan installments.
• Lost revenue: Compensating for the income you would have earned.
• Mortgage, rent, and lease payments: Covering the cost of your business premises.
• Employee training costs: For new equipment or machinery after covered losses.
• Relocation costs: Expenses for moving to a new or temporary location if your premises are physically damaged.

Read more about business interruption insurance in Cyprus and how it can protect your company.

Business Health Insurance in Cyprus

Also known as group health insurance, business health insurance is a type of health insurance plan provided by an employer to their employees and their families. It offers several advantages over individual health insurance policies.

What Does Business Health Insurance Cover?

A business health insurance policy covers medical expenses related to disease or accidental bodily injury. These plans typically cover inpatient (hospitalization) expenses and can also include outpatient expenses.

In Cyprus, health insurance is available from two sources:

1. Government GESY
2. Private insurance companies

How Does Business Health Insurance Work in Cyprus?

When obtaining a group health insurance plan in Cyprus, employers need to provide the following information:

• Number of employees and their dependents
• Employee details such as gender, age, and medical history
• The company’s activities and if employees are involved in high-risk tasks

Employers must decide if they want outpatient coverage in addition to the standard inpatient coverage. They must also declare how much time their employees spend in Cyprus and if they require medical treatment outside of Cyprus.

Business Health Insurance Coverage

Business health insurance plans cover expenses related to medical treatment, disease, and accidents. The coverage is divided into two categories:

• Inpatient expenses: Costs incurred for hospital stays, surgeries, pre-op and post-op exams, and other related expenses.
• Outpatient expenses: Costs that do not require hospitalization, such as routine visits, check-ups, prescriptions, and long-term care.

Inpatient Expenses Examples

• ICU costs
• Surgery costs
• Room rent charges
• Medical professional fees
• Operation theatre charges
• Costs of implanted devices
• Medicines & drugs
• Room boarding & nursing charges

Pre & Post Hospitalization Expenses

• Pre-hospitalization: Medical costs incurred before hospital admission.
• Post-hospitalization: Medical costs incurred after discharge.

Outpatient Expenses Examples

• Routine clinic visits
• Check-ups
• Prescriptions
• Physiotherapy
• Home care
• Hospice care

Types of Business Health Insurance in Cyprus

Business health insurance policies in Cyprus can be classified into two types:

1. Policies covering only inpatient expenses
2. Policies covering both inpatient and outpatient expenses

These policies can further be divided into international group health insurance and local policies. International policies typically cost more but offer higher coverage limits and can be used outside of Cyprus. Local policies are more affordable but limited to Cyprus.

Recommendations for Business Health Insurance

For employees living permanently in Cyprus and registered in the GESY, it is recommended to purchase premium business health insurance with international inpatient coverage but limited outpatient coverage.

Read our full article on business health insurance in Cyprus for more details.

Professional Indemnity Insurance in Cyprus

Also known as errors and omissions insurance (E&O) in the US, professional indemnity insurance protects businesses against claims related to professional mistakes.

How Does Professional Indemnity Insurance Work?

Professional indemnity insurance is designed to protect businesses against claims concerning the services they provide to customers or clients. It covers legal fees and compensation costs if your company is sued for professional errors.

What Does Professional Indemnity Insurance Cover?

Professional indemnity insurance can protect against the following claims:

• Inaccurate advice: Allegations of advice causing damage to a client.
• Negligence: Claims of negligence in services resulting in damage or injury.
• Misrepresentation: Accusations of false or misleading information leading to damages.
• Copyright infringement: Alleged use of copyrighted work without permission.
• Defence costs: Legal fees and court-related expenses.
• Libel and slander

What Does Professional Indemnity Insurance Not Cover?

• Bodily injury
• Accidental death
• Property damage
• Cyber attack claims
• Crime insurance claims (fraud, embezzlement)
• Directors & officers claims (mismanagement, abuse of authority)

Who Needs Professional Indemnity Insurance in Cyprus?

Professional indemnity insurance is mandatory in Cyprus for certain regulated professions such as financial companies, lawyers, and civil engineers. It is also advisable for large international companies providing services to third parties.

Difference Between General Public Liability and Professional Indemnity Insurance

• Public Liability Insurance: Covers claims by the public for personal harm or property damage.
• Professional Indemnity Insurance: Covers claims by clients for professional mistakes or negligence.

Claim Examples

• Public Liability: Breaking a client’s laptop (non-professional mishap).
• Professional Indemnity: A lawyer breaching client confidentiality (professional mistake).