Even before the COVID-19 pandemic, the way we work was changing, with more and more businesses operating from shared office spaces, or coworking offices.1 Now, following a downturn at the height of the pandemic, that trend seems set to continue, with a 4% rise in the number of these office spaces reflecting increased demand from businesses.2
In fact, demand for shared office space has risen by up to 48% compared with pre-COVID levels3, a sharp uptick that may reflect a broader array of businesses moving away from more traditional office arrangements. For instance, according to shared office space provider, WeWork, these spaces are no longer the preserve of freelancers and start-ups – the search for more flexible, cost-effective office space has driven the UK’s SMEs to take notice too.4
What is a Shared Office or Coworking Space?
In simple terms, a shared office or coworking space is a working arrangement that sees people from different teams and companies working in a single, shared space.
That could be space provided by one of the big players like WeWork or one of many smaller, independent business hubs across the country5, but all types promise similar benefits. They include short term leases and shared facilities, services and tools, which can help to make shared or coworking offices more affordable because the cost of infrastructure is shared between multiple occupiers.4
The other benefits of shared office space can include6:
- Operating in a dynamic, collaborative environment that is home to businesses from a wide range of sectors.
- Shared offices and coworking spaces tend to be ‘work-ready’, with facilities already in place.
- The fact that all services – from cleaning to IT – are shared and bundled in a single rent cost can simplify facilities budgeting.
- These offices tend to be flexible, making it easier to adapt office space as teams grow, or more space is required.
Shared Office Insurance and Business Risks
Alongside these benefits, shared office spaces can also create business risk, so before you take the plunge, it is worth carefully considering potential hazards and how to avoid them. Clearly, insurance can play a crucial role here, providing a solid basis for your business to thrive in a shared office space, but understanding the risks has to be the first step.
Shared office space risks might include:
- Accident or illness affecting staff or visitors: Clearly this a potential risk in any office, which can in some cases lead to claims for compensation. However, if these incidents happen in communal areas of a shared office space, who is liable? Is it your business, or the shared space provider? Firms based in traditional offices would normally turn to insurance covers like employers liability and public liability to defend against these risks, but the cover may be less clear cut in a shared officer space, so check with your insurer or broker if you’re unsure.
- Data and privacy risks: Shared office spaces may increase the risk to your business’s confidential information, and when things go wrong here, the consequences can be very serious – from big fines to loss of reputation.7 Heightened risk may be driven by use of less secure, shared Wi-Fi networks or something as simple as leaving sensitive material on a shared printer, so it is important to assess and manage these risks8 - for instance through cyber insurance.
- General office risks: A shared office space may also increase the risk of damage or theft affecting office equipment owned by your business – which could in turn affect your office insurance. Again, check with your insurer or broker to make sure the protection you have is adequate for a shared office space.
Help is at Hand
Quotes from well-known and specialist insurers, including: