Four insurance companies are backing an initiative to stop entire sectors of business being blacklisted by liability underwriters.

According to the Federation of Small Businesses (FSB), the idea is to create a way for small businesses to prove that they are practising good health and safety.

An FSB spokesman explained: "Entire sectors are being treated with a broad bush approach by underwriters, even though there are many companies within these sectors that have good claims histories and excellent safety records. "

He added: "We want to create a way for underwriters to reassure themselves, without resorting to expensive site surveys, that companies are practising good health and safety. "

"I can understand that insurers don't want to spend £2, 000 on site surveys when the premium is, on average, £1, 000. "

It is understood that a health and safety consultant has been retained to create a website that will allow FSB members to find free advice and to keep accurate records. These records can be accessed by underwriters, who will be able to satisfy themselves that the company has good procedures, despite being in a sector with a bad claims history.

The FSB spokesman added that the process would be driven by the insurance companies. It is understood that the companies involved are AXA, Norwich Union, NIG and PRI.

The FSB's broker Warren Hill has been instrumental in setting up the dialogue between the insurers and the employers.

Warren Hill managing director David Perry said: "Employers will be able to demonstrate their performance by continuous assessment. "

It is understood that the web proposition will be free to access to a certain level and will provide reference information. At the next assessment level, a fee will be required. A three-level scoring system will provide insurers with a red, amber and green way of assessing risks.

The FSB, which has 177, 000 members, said that the FSB had made the move in isolation from the ABI's own initiative, because its members needed urgent action.

The spokesman said: "The ABI is working hard, but has never mentioned a timescale for action.

Our members are facing problems now and need action. "