If you have a small business, what type of insurance do you need? Is there even a simple answer to this? Well, not really. For one, the type of coverage you need largely depends on what your small business does and how it’s performing. Additionally, there may be some state laws that require certain small business insurance policies so you need to make sure you’re getting the right coverage.
Without the right insurance coverage, unexpected events could result in you having to pay for claims out of your own pocket. The problem is that not all small businesses have the resources to cover such claims which means if any problem arises, they may not be able to stay afloat. That’s why it is crucial for small businesses to be insured.
Here are some of the most common types of small business insurance in Australia:
General Liability Insurance
General liability insurance provides protection against claims that involve your business’s legal obligations. It provides coverage for accidents that occur on your premises or in connection with your products and services. General liability policies will pay for expenses related to a lawsuit, including legal fees and damages.
Business Income Coverage
Business income coverage provides income protection in the event that your business is unable to operate because of specific covered events. In such cases, you're entitled to a portion of your income, which can be a good way to keep your business running and protect your assets.
Professional Liability Insurance
Professional liability insurance is specifically designed to cover the legal costs and damages that arise from your business or professional activities. This is often called errors and omissions coverage, and it’s an important component if your business provides services or products for others.
Commercial Property Insurance
Commercial property insurance covers your business’s property, including both real and personal property. This includes loss or damage to the business’s stock, equipment, and building.
Commercial auto insurance
Commercial auto insurance protects any vehicles used on a regular basis for business. This includes business-owned vehicles, as well as vehicles leased by your business. Commercial auto insurance will cover any damages that occur to the vehicle, or result from injuries to you or your employees.
Workers’ Compensation Insurance
All businesses must have workers’ compensation insurance to protect themselves from employee injury. If an employee is injured during work and the injury is covered by workers’ compensation laws, the employer may receive reimbursement for some or all of the wages paid to the injured employee during the time they were out of work. The policy will pay a percentage of the employee’s wage while they are off work until they are back on the job.
Data Breach Insurance
Data breach insurance is a relatively new policy, but it’s an important one. In today’s digital world, hackers are prevalent and can easily access personal information. If your business falls victim to a data breach, you can be held legally responsible for damages suffered by the affected individuals. Data breach insurance can protect your business from these types of claims.
Conclusion
The above are just the most popular types of small business insurance in Australia. But this is not an exhaustive list. The type of coverage you need will depend on the nature of your business. In addition to that, you may be required to have additional policies depending on your state. For example, in some states, employers are required to have workers’ compensation insurance, which is not the case in all states.
If you’re unsure of what policy options are available to you, speaking to a business insurance agent or broker can help. They can help you determine which policies will be most beneficial to your business.
Ensura is one of the trusted insurance brokers in Australia that can help you find the business insurance policy that will provide you with the protection that you need. Get in touch with our Sydney-based insurance brokers to know more about our policies!
Disclaimer: As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy document. The information contained on this webpage is general only and should not be relied upon as advice. The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific insurance product. It is only intended to provide education about the financial and insurance industry. The views reflected in the commentary are subject to change at any time without notice.
