Business Insurance Finder™

Finding business insurance doesn't have to be daunting. We're here to explain why business insurance is important, what types of cover out there, and how you can find a policy that's right for you. That way, you'll be able to make an informed decision, which makes good business sense.

What is business insurance and why do I need it?

Accidents can happen and any business runs the risk of losing its reputation, cash flow and ability to survive if disaster strikes. On top of all that, you could even have to dig into your own personal finances.

Let's say you're a plumber and you incorrectly fix a pipe for a restaurant which forces it to stop operating for a month. You could be forced to pay out what the restaurant would have earned in that time – all because of a genuine mistake.

This is why business insurance exists. It's protection for a range of things like getting sued and much more.

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If you are ready to speak with a consultant about different business insurance options available, simply enter your details in the form. Keep reading if you want to learn more about the different types of cover available.

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Note: If you are after an insurance quote for professional indemnity insurance, you'll need to either speak to a broker or use our online engine.

Types of risks businesses could face

It doesn't matter if you're running a small retail store employing 5 people or a huge architecture firm employing 50, there are risks involved. The right type of insurance could save you thousands in unforeseen legal fees or compensation claims.

The main types of business insurance

Professional indemnity insurance

Covers your business if someone tries to claim compensation over incorrect advice or a service.

Product liability insurance

This covers you from third-party injuries or damages caused by products your business sells.

Public liability insurance

This protects you in case you cause third-party injuries or damages in public.

Specific types of business insurance

Fire and theft cover

This protects against property and item damage due to fires and losses from theft.

Management liability insurance

This covers mismanagement claims in business.

Cyber liability insurance

This is liability cover for businesses that work digitally and online.

What type of business insurance do you need?

• The main types to consider
• Specific types

• Is business insurance compulsory?

  While many forms of business insurance are optional for companies, you may be required by law to hold specific insurance policies. The following insurance is compulsory:

  • Workers compensation. If you're working in Australia and you have employees, you must have workers compensation insurance.

  The following may be compulsory, depending on your business and where it's operating:

  • Public liability (PL) insurance. While most states require business owners to have PL before they can provide services, certain states have more stringent requirements. For example, electricians in Queensland, plumbers in Victoria and film makers in the ACT are required to have millions of dollars of PL cover before operating.
  • Professional indemnity insurance. Whether this is compulsory varies widely for different professions across Australia. For example, architects and real estate traders must get this cover in NSW, while South Australia requires it for legal, construction and healthcare services. Check state laws to determine whether it's required for your business.

• Will I be covered for business performance?

  Some risks such as an economic recession where demand for your product or services may fall or a close competitor infiltrates your market are not covered by business insurance but other risks can be.

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How much will business insurance actually cost?

We looked at professional indemnity insurance as well as public liability insurance and found the following average costs across both:

Factors that affect cost

Like most insurance quotes, it depends on circumstance. The amount you pay for cover depends on what type of business you're running, how many people you employ and what sort of extra risks you run. Chances are if you're running a light team of four or five librarians, your insurance will cost less than if you have fifty architects planning homes across the country.

What can I do to reduce how much I pay for cover?

The following are some key steps you can take to avoid overpaying for cover you don't actually need:

• Increase your excess. Like most insurance policies, raising what you pay in case of a claim can drive down your ongoing premium costs.
• Bundle up. Taking out all your policies with a single company can net you a handy discount.
• Skip useless extras. If you don't need it, don't pay for it! An insurance broker can help you figure out what's likely to matter for your business and skip the rest.

Is business insurance worth it? Consider the following scenarios

You've worked hard to get where you are. Maybe you built your business from the ground up or you've taken it and turned it into something to be proud of. So why risk it? No matter how careful you are, accidents happen, mistakes get made and people file complaints out of anger or spite. Without insurance, one bad situation can put you out of business for good.

What would you do if someone got really sick or a worker was injured on your site? How would you cope if a flood ruined your building or a thief made off with thousands of dollars of stock or private data? These are important questions you'll need to answer.

Here are a few situations where business insurance just might save you:

You're running a small medical practice

You own a restaurant

In the course of an evening, one of your waiters trips and spills boiling hot soup on a customer. Business insurance can help you with recompense for the injured person and cover any possible legal fees that you otherwise could face.

You're the owner of a retail outlet that sells expensive jewellery

How do I find the best small business insurance in Australia?

When shopping around for insurance, you need to know what you want in order to get the best deal. Here are some simple checks to consider when browsing:

1. Figure out your business risks

Every business is different. Depending on how your business works, you'll naturally have different risks. Determine the most likely issues to come up and which would be most damaging without insurance. If you have employees, what would happen if they were dishonest or got injured? Do you have a product or service people might be unhappy with? How vulnerable are you to theft or disasters?

2. Compare policies that cover your risk

Once you've figured out the risks, you can pick a policy. You might need one of the three main kinds of business insurance or some combination of them. Figure out what special circumstances apply to your business. Are you building homes or moving merchandise? This determines which extras you may need.

3. Picked a policy? Now look at what you are covered for exactly

Ensure you understand the policy you're taking out. Are you covered for the worst situations? Is your insurance limit high enough to cover your most valuable assets if they get damaged or stolen?

4. Check what's not covered

This is almost more important than what you are covered for. Every insurer places caveats on claims. These are situations and circumstances where they won't acknowledge a claim. Investigate these carefully before taking out a policy. We've listed some of the most common in the "Exceptions" section below.

5. Consider an insurance broker

Using an insurance broker to choose the best policy for you can save you money overall. Finding the perfect policy can take a long time and can cause a ton of stress. Even after all this, you might end up with an inadequate or an over-the-top policy. Insurance brokers can walk you through the process, assess the biggest risks your business is likely to face and choose the best policy for you.

Small business insurance

Run a small business? Here's why cover is essential

If you run a small business, you likely don't have to worry about many of the same problems that a much larger business would face. But this doesn't mean that you're home free. Small businesses have a number of unique risks that a larger company doesn't.

These can include the following:

• Small customer pool. How many customers make up the bulk of your business? If one of your regular customers stopped using your services for any length of time, it could lead to a catastrophic drop in revenue.
• Few suppliers. How many suppliers do you generally rely upon? If one of your suppliers stopped supplying you, it could severely slow down business or bring it to a grinding halt.
• Employee issues. These are wide-ranging and can include staff seeing your business as temporary employment on their way to another job, leading to high turnover rates. You may have a few employees who are crucial to your business leave and throw things into chaos. It's even possible that employees who are necessarily given a lot of freedom in running important parts of your business abuse your trust and commit fraud.
• Limited premises. Small businesses are frequently tied to one location that is vital for their operation. What would happen if a storm or fire heavily damaged the premises or the business outgrew the location? This could cause dangerous and expensive disruptions.
• Reputation. Many small businesses live and die by their reputation in a community or industry. How would you cope if your company were accused of fraud or dishonesty?
• Cyber risk. Disruptions to power, Internet access or machine function can completely shut down a business's trading capability. A virus ruining your computers or a power outage can have very expensive consequences.
• Small financial overhead. If you trade on credit, it's possible you may be called to account. What would you do in that situation? What if competitors were to appear in your market and disrupt your finances with similar services and lower prices?

Frequently asked questions

Does business insurance cover loss of income?

Under business interruption insurance, a business will be covered for loss of revenue that it suffers following an unforeseen event. This means that while the business is being repaired, cash will be provided to account for the loss of revenue but not for personal income.

The benefit will be paid until the end of the business interruption period, which is determined at the time of application. This is known as the indemnity period.

• How long should my indemnity period be?

  This will differ from business to business, so you will need to take the time to assess the risks that face your business and how long they could take to recover from. As an example, insurer CGU reportedly had a customer that was only able to recommence operating after a period of 18 months after the business was consumed by a fire.

Still not sure? Some final questions you might have

• Can a broker customise insurance for a commercial enterprise?

  Every company's insurance requirements will depend on their industry, the size of their interests and where they are located in the world. So it is important for a company to ensure their commercial insurance is tailored to their own unique needs and risk profile.

  A corporate insurance broker will set about customising their cover by looking at each facet of the company's operations, identifying the types of threats they potentially face and limiting their exposure as much as possible by recommending an insurances portfolio that provides protection against each of those risks.

• Is business insurance tax deductible?

  According to the ATO, you can claim tax deductions for most costs that are incurred in the running of your business. However, there are exceptions to this. You are not able to claim for private or domestic expenses.

  Insurance premiums are deductible if they have a necessary connection with earning an assessable income. Premiums are deductible for the following types of insurance:

  • Workers compensation insurance
  • Professional indemnity insurance
  • Income protection insurance

  • Public liability insurance
  • Fire and theft cover

• How do I make a claim?

  Your insurance provider will have supplied a number and instructions about how to make a claim. In most cases, you will need to supply proof of ownership or legal responsibility and as many details as you can about your claim.

• I already have insurance, but I think it's in need of a review. What can I do?

  Have cover in place but not sure if there may be something more suitable out there? Here are some steps to review existing cover:

  • Assess how your business has changed in the last 12 months. Has your number of staff grown or decreased? Have you obtained new assets?
  • Cut cover you don't need. Do you have cover in place that is no longer relevant to the risks your business has? Can these be trimmed back?
  • Add cover for any new risks your business is now facing. Do you face new risk events that could cause a loss of revenue?.

• Is it worth using a broker to help me find cover?

  • Business insurance can be complex. There is a wealth of business insurance policies available on the market, each of which has been designed to meet a specific need. Determining the right type and level of cover for your business can be quite a difficult task, so it pays to have help.
  • Brokers are experts. Business insurance brokers have a wealth of experience and an in-depth understanding of the business insurance market. They know which policies are available and which ones will be right for you.
  • Brokers work for you. Just like your accountant works in your best financial interests, it's the job of a broker to do everything they can to get you a suitable insurance deal.
  • Brokers know your business. A good business insurance broker will take the time to understand the ins and outs of your business. This will give them the information they need to formulate a reliable insurance strategy that matches all your needs.
  • Brokers know the market. A business insurance broker knows exactly what policies are available on the Australian market. They can hook you up with policies and insurers that you may be unaware of if you were simply trying to arrange cover yourself.
  • There are specialist brokers available. You may be able to find an insurance broker who specialises in finding cover for businesses in your industry. This ensures that they will have an even greater knowledge and understanding of the risks facing your company

• When won't I be covered?

  Like any insurance policy, it's equally important to know when you won't be covered. You can avoid losing out by checking the exact details of your policy, but there are a few that most policies won't cover. You'll probably lose out if your claim involves the following:

  • War, rebellion or insurrection
  • Government-approved confiscation, requisition or destruction of your property
  • Radioactivity
  • A company you acquired after taking out business insurance or any assets related to that company
  • Unoccupied buildings or premises
  • Damage to buildings by lightning, earthquakes or impact by road vehicles or falling buildings
  • An electronic device or software that isn't Electronic Date Compliant
  • Aggravated or punitive damages or fines
  • Obsolete equipment that is no longer used in the business

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