What is business insurance?

Business insurance is a catch-all term for a number of policies that can protect your business from financial loss. This can include the damage, theft or loss of your property, equipment or stock. It can also cover legal costs linked to your company's activites.

What are the main types of business insurance?

The main types of business insurance are: Public liability insurance Professional indemnity insurance Commercial property insurance Business interruption insurance

Do I need workers compensation insurance?

If your business employs someone, you will probably need workers compensation insurance. It's a legal requirement in all Australian states. You can find out more about workers compensation here .

Can I get drone insurance as part of business insurance?

Drone insurance can be included in your business insurance policy if you require it. It can cover you for loss or damage, aviation liability, data protection and more.

What is public liability insurance?

Public liability insurance can cover legal costs if you cause injuries to someone or damage their property. It refers to damages from the physical surroundings and property – not from services you provide (this is what professional indemnity covers).

How much does business insurance cost in Australia?

Business insurance costs vary widely, with the premium dependant on the size and type of business . Premiums typically start from $20 to $100+ per month and can go as high as several thousand dollars per month, depending on industry, coverage and risks.

Is business insurance mandatory??

Some types, like workers' compensation insurance , are mandatory. Others, such as public liability insurance, are highly recommended but optional.

Can I take out Public Liability insurance?

Public liability business insurance is available to business owners, contractors, and sole traders. It offers financial protection in case a third party experiences harm or loss on your premises or because of your operations.

What is the best insurance for a small business?

Public liability and professional indemnity insurance are essential for many small businesses, to protect against common risks like someone getting injured at your place of business.

Can a small business choose to self-insure?

Self-insurance allows a business to set aside funds to cover potential risks instead of purchasing insurance. However, it requires financial stability and careful risk management.

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How does business insurance work?

Business insurance protects your company from financial losses due to unexpected events like property damage, lawsuits, employee injuries, and business interruptions. It works by transferring the risk of these losses to the insurance company in exchange for regular premium payments.

One of the best bits of business insurance is that you can pick and choose which types of cover you want. Don't have any stock? Scrap commercial property. Worried about an online hack? Add cyber insurance. Business insurance tends to be very customisable, which is great news for your business.

The value of business cover

"I'm a gigging musician alongside my work at Finder. That means moving a lot of expensive gear in and out of venues and studios, which brings with it some risk - to me as well as other people. My business insurance covers my instruments, amps and other gear for damage or theft, as well as for public liability. Even though it's not my entire income at stake, it's piece of mind that I couldn't do without."

Tim Bennett

Insurance expert

Which types of business insurance do you need?

If you're not sure which type of business insurance you need, we suggest chatting with an expert broker who will be able to help. However, we created the table below as a quick guide.

Type	If your business...	You run the risk of...	Insurance can help you with...
Commercial property	Has a physical location or stock	Property damage due to theft, fire, water, storms, impact and more	The cost of repairs or replacement
Professional indemnity	Gives advice or provides a service	A customer filing a lawsuit if you give incorrect or misleading advice	Legal fees, investigation costs and compensation
Product liability	Creates and sells any product	That product injuring someone or causing property damage	Legal fees, investigation costs and compensation
Public liability	Has a physical location or comes into contact with people in any way	A person being injured or killed due to your business activity or premises	Legal fees, investigation costs and compensation
Business interruption	Requires a certain location, certain equipment or even just certain circumstances to operate	Your business being unable to operate if something disrupts the basic requirements	Covering the cost of lost income
Cyber	Has any online involvement	Cyber attacks, leaked customer information, ransom demands	Data recovery, expert consultants, legal fees and compensation

Is business insurance compulsory?

Public liability insurance and professional indemnity are compulsory for certain professions. Without it, you may not be able to operate with a full licence.
Different states set requirements for liability insurance, as do professional associations and licensing bodies. Some even set minimum requirements for the amount of insurance needed.
Many businesses will require that their suppliers or service providers have business insurance as part of their contract.

Must read

If you employ at least 1 person, it's very likely you will need workers compensation insurance. Read about the specific requirements.

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Frequently asked questions

The main types of business insurance are:
- Public liability insurance
- Professional indemnity insurance
- Commercial property insurance
- Business interruption insurance

Sources

Thank you for your feedback!

To make sure you get accurate and helpful information, this guide has been edited by Moira Daniels as part of our fact-checking process.

Written by

Gary Ross Hunter

Journalist

Gary Ross Hunter has over 6 years of expertise writing about insurance, including life, health, home, and car insurance. Having reviewed hundreds of product disclosure statements and published over 800 articles, he loves simplifying complex insurance topics for everyday readers. Gary has contributed to major outlets like Yahoo Finance, The Sydney Morning Herald, and news.com.au, and holds a Bachelor of Arts (Honours) in English Literature from the University of Glasgow, along with a Tier 2 General Advice certification, ensuring his work adheres to ASIC’s RG146 standards. See full bio

Gary Ross's expertise

Gary Ross has written 588 Finder guides across topics including:

Health, home, life, car, pet and travel insurance
Managing the cost of living

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