Contact your insurer or broker directly for more information.
Whether you're a sole trader with one employee (you) or run a construction site with 20 employees, getting the right insurance cover is crucial for every small business. You never know when things might go wrong, so it's better to be safe than sorry.
So where do I start?
Business insurance doesn't have to be confusing and difficult. Business Insurance Finder™ offers tools and guides to explain how it works and help you save money on cover.
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.
Types of risks businesses could face
You're a retail owner and someone slips on your premise.
Damaging someone's property
You own a car wash and one of your employees spills chemical into a car's interior.
Getting sued for a faulty product
You accidentally sell fruit which is contaminated and your customers get sick.
Giving incorrect advice or service
You're an architect and you provide a client with a flawed design that needs to be fixed after the building has already been built.
Financial penalties for mismanagement
You could be penalised for breaching occupational health and safety regulations.
Business-specific accidents and damages
Some businesses will need to cover against theft, while others will be concerned about natural disasters like fire.
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.
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.
Site being damaged by natural disasters or other causes
Employees being injured on site
Physical loss, destruction or damage to the property
Legal liability for third-party injury or property damage
Transit of construction materials
In addition to the basic insurance detailed above, there are a number of options available to deal with your specific needs.
These are covered in much greater detail further down, but here are a few examples:
Fire and theft cover. If your business is especially susceptible to loss by theft or fire, such as a private theatre or a retail outlet, this can help cover the costs of restoring the building and replacing whatever was damaged or stolen.
Management liability. This can protect you from claims arising from your alleged mismanagement of the company, rather than any direct fault of a product or service. These claims often affect your personal wealth as well as that of the business.
Construction insurance. This is public liability specifically for situations where you're building, renovating or extending a home and covers on-site accidents, vandalism and damage from natural disasters.
Cyber liability insurance. Cyber risk is a rapidly increasing problem for businesses. If you have any digital assets, such as online finances or confidential data, or you use digital devices heavily for your business, this can help.
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.
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.
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
A patient who sought advice from one of your doctors concerning a medical procedure files a legal complaint against you when the procedure goes poorly. Even though the doctor's advice was sound and the procedure was botched by someone else, you'd still have to pay thousands of dollars in legal fees to settle it, which insurance would cover.
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
Despite the extensive security measures you've wisely invested in, a thief manages to break in and get away with thousands of dollars of stock. Without business insurance, you'd either have to accept the loss of whatever unique and pricey pieces the thief got away with or pay to replace it out of your own pocket.
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?
Will business insurance cover the coronavirus?
Research published by Roy Morgan in mid-February found that roughly 1 in 6 Australian businesses had already been impacted by the coronavirus. Unfortunately, it's unlikely business insurance will be able to help with lost revenue.
Following the 2003 outbreak of SARS, lots of Australian insurers made significant policy changes, making it difficult for SMEs to claim on their business insurance policies. Of course, there's no harm in contacting your insurer or broker directly - they'll be able to give you a clear idea of how your policy responds.
Remember: Under the Work Health and Safety Act 2011, business operators are required to ensure, so far as is reasonably practicable, the health and safety of workers and others at their workplaces.
Operators must identify hazards at the workplace as well as any associated risks - and act on them, by implementing practicable control measures. If you're aware the coronavirus is a risk in your workplace, and don't act on it, you might be in breach of the act.
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.
This typically includes the following:
Profits that would have been earned based on the previous financial statements
Rent of a temporary location while repairs are being made. This may include advertising costs to let customers know the new location
Staff wages while the business is temporarily closed
Additional expenses that ensure the business is able to continue to operate while repairs are made
Fixed costs that still have to be covered on previous property that is under repair
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.
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
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
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?.
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
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
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
Willam Eve is the country manager for Finder's Canada operations. He has previously held the positions of group publisher of insurance for Finder Australia and lead publisher for the Finder global team. William has a Bachelor of Communications from the University of Technology Sydney, Australia. He loves the challenge of launching Finder into new markets while helping grow Finder’s global team.
How likely would you be to recommend finder to a friend or colleague?
Very UnlikelyExtremely Likely
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Important information about this website
finder.com.au is one of Australia's leading comparison websites. We compare from a wide set of banks, insurers and product issuers. We value our editorial independence and follow editorial guidelines.
finder.com.au has access to track details from the product issuers listed on our sites. Although we provide information on the products offered by a wide range of issuers, we don't cover every available product or service.
Please note that the information published on our site should not be construed as personal advice and does not consider your personal needs and circumstances. While our site will provide you with factual information and general advice to help you make better decisions, it isn't a substitute for professional advice. You should consider whether the products or services featured on our site are appropriate for your needs. If you're unsure about anything, seek professional advice before you apply for any product or commit to any plan.
Products marked as 'Promoted' or 'Advertisement' are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment when you click on those buttons or apply for a product. You can learn more about how we make money here.
When products are grouped in a table or list, the order in which they are initially sorted may be influenced by a range of factors including price, fees and discounts; commercial partnerships; product features; and brand popularity. We provide tools so you can sort and filter these lists to highlight features that matter to you.
We try to take an open and transparent approach and provide a broad-based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labelling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
Providing or obtaining an estimated insurance quote through us does not guarantee you can get the insurance. Acceptance by insurance companies is based on things like occupation, health and lifestyle. By providing you with the ability to apply for a credit card or loan, we are not guaranteeing that your application will be approved. Your application for credit products is subject to the Provider's terms and conditions as well as their application and lending criteria.