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Types of Business Insurance

There are usually three types of insurance that are mandatory for Australian businesses

What you need to know

  • A business faces a myriad of risks every time it opens its doors, from fire, theft, damage and loss to being sued for injuries by a member of the public.
  • Having some form of business insurance is important to protect both your assets and yourself.

To ensure your business gets the protection it needs, we've laid out the different types of business insurance you can take out, what's mandatory, the costs and more.

Is insurance compulsory for businesses?

There are usually three types of insurance:

Hand bandaged

Workers compensation insurance

If you have employees, you are required to have this to protect them in the event of an accident or illness.

Car accident

Third-party personal injury insurance

If you own and operate motor vehicles as part of your business, you must have compulsory third party (CTP) insurance to cover you against personal injury claims that relate to the use of those vehicles.


Public liability insurance

This is often also compulsory for certain types of businesses and the self-employed, such as plumbers and electricians in certain states, and covers you for third-party death or injury.

What types of business insurance can I get in Australia?

There are a number of kinds of business insurance available in Australia, all of which protect you for slightly different risks and dangers. Here's a clear breakdown of what they do:


Liability cover protects you from the numerous legal risks you encounter when you run your own business. Depending on the type of business you run, you can get liability cover with the following types of insurance:

  • Professional indemnity. This protects businesses that provide specialist services or professional advice by covering you for lawsuits and financial losses that result from a client following your advice or receiving your service. For example, if you're a builder and it's found that there are major structural faults with the work you've done, you might get sued. A professional indemnity insurance policy would help cover the legal costs.
  • Public liability. If someone makes a claim against you for any injury or damaged belongings that your business activities cause them, public liability insurance can cover you for the costs involved. For example, if a customer were to slip and fall on your property, this would cover you.
  • Product liability. This protects you for loss or damage claims made against you caused by products your business sold or supplied. It's often included in a public liability policy and covers you for the relevant legal costs.
  • Management liability. This is tailored to directors and managers, and it can cover you for claims made against you for mismanagement, discrimination and other risks associated with managing a company.
  • Cyber liability insurance. If your business relies on technology to operate, cyber insurance can cover you for claims made against you due to cyber attacks. It can cover you for damaged hardware, legal costs, damaged reputation and more.

Assets and income

Another important part of running a business is being able to protect everything that you own and the money you make from it. Some of the policies you can get include the following:

  • Building and contents. Covers damage or loss to the building you operate your business in and its contents.
  • Theft. Covers you against loss or damage to your contents or stock as a result of theft, burglary or deception.
  • Money. Covers the theft of your money from your business premises, during transit and, in some cases, at your home. This is generally separate from theft cover.
  • Commercial vehicle. A choice of third-party property, third-party fire, theft or comprehensive cover for your business vehicle.
  • Stock deterioration. Covers deterioration of goods if a freezer machine or a refrigerator breaks down.
  • Glass. Covers the cost of replacing broken external or internal glass and glass items.
  • Employee fraud or dishonesty. Covers losses suffered as a result of dishonest actions by your employees.
  • Machinery/equipment breakdown. Covers the repair or replacement cost of machinery and equipment that breaks down.

Business interruption

It's also possible to get cover for interruptions that can impact or prevent you from earning an income. These types of business insurance protections can often be added to a policy and include the following:

  • Business interruption. If a natural disaster like a storm negatively impacts your business operations, business interruption can cover you for losses suffered and ease your financial losses.
  • Tax audit. This covers the cost of any ATO-prompted investigation or audit into your tax liability. It can pay for you to hire an accountant or tax agent.

Finder survey: Do people think business insurance is worth it?

Source: Finder survey by Pure Profile of 1112 Australians, December 2023

What type of insurance does my business need?

The right insurance for your business will depend on several factors, including the kind of business you are in, its size and structure, and the industry you belong to. To narrow it down, here are some of the questions you might need to ask yourself as a business owner:

Key questions Answer Cover types you may need:
Do you make goods that are sold to the public? YesProduct liability insurance
Do you serve customers in a public place or at your premises?YesPublic liability insurance
Do you give advice in a professional capacity?YesProfessional indemnity insurance
Do you have staff working for you?YesWorkers compensation, employee fraud or dishonesty insurance
Do you have any specific things you need protected?Yes, I have machineryMachinery breakdown insurance, electronic equipment insurance.
Do you do most of your business online?YesCyber liability insurance

The answers to questions such as these can give you an indication of where your main exposures are as a business and the kinds of business insurance you might need.

How much does a policy cost?

Like most types of insurance, it comes down to your specific circumstances. The amount you pay for cover will depend on what insurance you need, the type of business you run, how many people you employ and where you operate.

To give you an idea though, the tables below outline the average costs for professional indemnity insurance and public liability. The average cost for the former for a self-employed tax agent for example is $49.76 a month while the average small business owner can expect to pay $80.75 per month in public liability insurance.

Professional indemnity insurance

InsurerYearly costMonthly costExcess payable on claims
Berkeley Business Insurance$346.91No options to pay monthly$0 Excess
AIG Business Insurance$527.73$43.54 per month$1,000 Excess
Vero Business Insurance$547.17$45.15 per month$0 Excess
Dual Business Insurance$659.66$54.43 per month$1,000 Excess
QBE Business Insurance$677.71$55.92 per month$1,000 Excess
Average cost$551.84$49.76$600

Data was taken from our quoting engine in February 2018 based on a sole trader tax agent looking for $250,000 in professional indemnity insurance cover.

Public liability insurance

Estimated Annual revenue$200,000$400,000$500,000$1,000,000
Insurer 1$60.61$64.56$346.09$670.79
Insurer 2$60.87$69.19n/an/a
Insurer 3$144.41$230.79n/an/a
Average cost (per month)$88.63$121.51$346.09$670.79

Quotes taken from BizCover's Insurance engine in March 2018. Policies come with an excess of $500.

How to apply for a policy

Applying for a business insurance policy can be stressful if you do it yourself. Our Business Insurance Finder™ makes it easier though. This lets you get personalised quotes, compare policies side by side and tailor coverage to your needs. You'll be asked a few questions to help determine what kind of insurance you want or need and you'll also be asked a few simple questions about your business, including how many employees you have and your estimated annual revenue.

Alternatively, if you don't want to do it yourself, you can get a business insurance quote from a broker by filling out the form below. Brokers can be helpful because they're insurance experts and can make sure you're getting the cover your business needs. They'll also take the time to work out the ins and outs of your business.

Talk to a broker about business insurance

Frequently asked questions

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