The cost of business insurance is nothing compared with the impact of not having adequate protection in place if something goes wrong, one expert has warned.

Chris Simpson, account manager at Business Link, explained that while some firms might be tempted to view insurance as non-essential they are taking a risk by not being covered.

He said: "[Firms should] take out the insurances that are required by law and then look at other ones and what the detrimental affect would be on their business if they didn't have that insurance."

Mr Simpson compared the situation to car insurance stating people only realise that such protection is vital after they have had an accident.

According to research by the Association of British Insurers, its members paid out £64 million a day in claims during 2006.

This included £8.9 million a day in liability claims for accidents at work and £5.8 million a day for damage to business property.

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