Typically, a business insurance broker sells you insurance and takes a cut of the premiums for themselves. This means the same policy might be more expensive to buy through a broker than it would be to buy it directly.
Sometimes, but not necessarily. There are some policies that might only be available through brokers, but for the most part, you can expect to find brokers offering the same policies that you can purchase direct yourself.
Yes. One of the main advantages of paying extra for a policy from a broker is that they can become a new point of contact for your insurance needs. For example, if you need to make a claim or update your policy details, you can call your broker to take care of it instead of wading through the insurer's customer service queues yourself.
One of the decisions you have to make when shopping for public liability insurance cover is whether you want to purchase cover through an insurance broker. The ability to buy direct from the insurer can sound appealing to some business owners, but there are many advantages to taking out cover through an insurance broker.
Just as it’s the job of an accountant to look after your best financial interests, it’s a broker’s job to look after your insurance needs in the best way possible. A good insurance broker will have a wealth of training and experience and will have the expert knowledge required to give specialised insurance advice for your business. Brokers will take the time to understand the ins and outs of your business and then offer advice specifically tailored to your situation.
A broker can track down a number of suitable policy options for your business and then help you compare them. After weighing up the pros and cons of a number of policies, your broker can then ensure that you choose the right public liability policy for your needs.
| Response | WA | VIC | SA | QLD | NSW |
|---|---|---|---|---|---|
| once a year | 1.65% | 1.65% | 5.38% | 2.3% | 1.83% |
| every 2 yrs | 0.83% | 0.66% | 1.38% | 2.14% | |
| once every 3+ yrs | 0.83% | 0.99% | 1.38% | 0.92% | |
| I never compare or switch | 4.95% | 1.08% | 3.23% | 0.92% | |
| more than once a year | 0.66% | 0.31% |
When you buy insurance through a broker, you might be paying extra in brokerage fees on top of the policy premiums. But often this is money well spent. Between the services they provide and the potential savings, using a broker might be worth it.
You might avoid using a broker if you can confidently buy business insurance direct. If not, you might want to go through a broker instead.
There are no hard and fast rules, but a useful starting place might be to look at some of the business insurance packages available in Australia.
Finder ran some business insurance quotes for a NSW-based events company with 5 employees. We found a public liability policy with Vero may cost $40.75 per month ($500 policy excess). This indicative quote was correct as of 29 June 2023.
As mentioned, it is possible to go directly to an insurer to purchase your public liability cover. While this may be a suitable approach for some, for some businesses, it might make better financial sense to enlist the services of an insurance broker.
The main benefit of brokers is that they are insurance experts. Day in, day out, brokers specialise in finding the right insurance cover for their clients. They have an in-depth understanding of the Australian insurance market and of the range of policies available, and they have access to a broad spectrum of policies across the market.
Public liability insurance, and any form of business insurance for that matter, can be a confusing topic to wrap your head around. For most business owners, the time required to compare your options and choose the right public liability policy is something they may struggle with.
Without the necessary time and specialised knowledge of the insurance sector, businesses who approach an insurer directly to take out cover can end up with an inadequate level of protection in place. Some end up under-insured, which can be a nightmare when disaster strikes, while others end up paying too much money for some cover elements they simply don’t need. But ultimately, it's your decision to make.
If you’ve decided to get help from an insurance broker, there are a handful of steps you can take to ensure you end up with the right broker for your business. To start with, look for a broker with a high level of qualifications and experience. You can usually find this information in a broker’s financial services guide, which they are required by law to provide you with.
While it may seem simple to choose a broker that is located the closest to your business, this isn’t necessarily a good approach. Some brokers have specialised areas of expertise, such as public liability insurance, so will be better qualified to meet your particular needs. Some brokers also specialise in finding insurance for specific professions, so if you can find a broker with a wealth of experience in insuring other business in your industry, consider using their services.
Public liability insurance offers a much-needed form of cover for a whole host of businesses, whether you run a small operation or a large company. However, in order to ensure you end up with the right level of coverage for your business, compare a number of policy options and enlist the help of a qualified insurance broker.
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