Insurance for Online Businesses

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:

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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

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.

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?	Yes	Product liability insurance
Do you serve customers in a public place or at your premises?	Yes	Public liability insurance
Do you give advice in a professional capacity?	Yes	Professional indemnity insurance
Do you have staff working for you?	Yes	Workers compensation, employee fraud or dishonesty insurance
Do you have any specific things you need protected?	Yes, I have machinery	Machinery breakdown insurance, electronic equipment insurance.
Do you do most of your business online?	Yes	Cyber 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 $55.58 a month while the average small business owner can expect to pay $115.21 per month in public liability insurance.

Professional indemnity insurance

Insurer	Yearly cost	Monthly cost	Excess payable on claims
	$684.75	$57.06	$1,000
	$511.50	$42.63	$0
	$1,074.56	$89.55	$0
	$430.65	$35.89	$2,500
	$563.78	$46.98	$1,000
	$736.73	$61.39	$750
Average cost	$667.00	$55.58	$1,292

Data was taken from our quoting engine in February 2025 based on a sole trader tax agent looking for $250,000 in professional indemnity insurance cover.

Public liability insurance

Industry	Food	Food	Construction	Construction
Employees	5	10	10	30
Estimated Annual revenue	$200,000	$400,000	$500,000	$1,000,000
Insurer 1	$45.20	$63.21	$508.75	$1,003.75
Insurer 2	$140.01	$223.58	n/a	n/a
Insurer 3	$160.41	$311.67	n/a	n/a
Average cost (per month)	$115.21	$199.49	$508.75	$1,003.75

Quotes taken from BizCover's Insurance engine in December 2024. Policies for food industry 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

Receive a Quote for Business Insurance

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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FAQs

• Does online business insurance cover me for sales to customers in the US and Canada?

  No, most standard Australian business insurance policies exclude claims originating in the United States and Canada unless you specifically add a worldwide extension. You must notify your insurer if you sell to North American markets because the high litigation costs in these regions require specialised coverage and higher premiums.

• Am I covered if my online business is run from a home office?

  No, standard residential home and contents insurance policies typically exclude business-related equipment and liability. You generally need a separate business insurance policy or a specific home-based business extension to ensure your work laptop, stock and professional liability are protected while operating from a residential address.

• Does insurance cover my stock if it is held in a third-party fulfilment centre?

  Yes, stock held in a third-party warehouse or fulfilment centre can be covered if the location is specifically declared in your policy. General business insurance usually only covers stock at your primary registered address, so you must inform your provider about off-site storage to ensure items are protected against fire, theft or damage.

• Do I need product liability insurance if I use a dropshipping model?

  Yes, you still need product liability insurance because under Australian Consumer Law you can be held responsible for faulty products even if you do not manufacture or ship them yourself. If the manufacturer is located overseas, you are often legally treated as the manufacturer in the eyes of the consumer, making you the primary target for liability claims.

• Is cyber insurance automatically included in online business insurance packages?

  No, cyber insurance is usually an optional add-on and is rarely included in a standard public or professional liability policy. You must specifically select cyber cover to protect your business against the costs of data breaches, ransomware attacks and mandatory notification requirements under the Privacy Act.

• Can I claim for lost revenue if my website server goes down?

  Yes, you can claim for lost revenue if you have business interruption insurance that includes coverage for utility failure or cyber events. This cover helps bridge the gap in income if a technical failure or cyberattack prevents your website from processing orders for an extended period.

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