The Seven Types of Small Business Insurance You Should Know About

As a small business owner, your business is your livelihood and something that should be protected.  You face a number of challenges on a daily basis, most of which are unpredictable and unpreventable.

In some cases, events that occur result in damage to your assets, legal claims being made against you or injury to employees, which can have huge financial repercussions.  Many businesses don’t have the financial resources to survive such an event, so a good insurance policy is imperative.

Some types of insurance are highly recommended for Australian businesses.  Depending on your operations, you should have the following policies in place:

Worker’s Compensation: If you employ staff, you must have workers compensation insurance to protect them in the event of sickness or injury. This type of insurance provides wage replacement and medical benefits to those who are injured while working, and protects your company from facing legal action following an incident.

Commercial Vehicle Insurance: Third party insurance is mandatory if you own a motor vehicle.  Other types of vehicle insurance are optional, but should be considered depending on your usage.  If your company uses vehicles to transport employees or equipment, you should consider protecting them to save costs in the event of damage or theft.  Or, if your employees drive their own cars on company business, non-owned auto liability can protect the company from being liable to pay out in the event of a collision.

Public Liability: Liability insurance covers the company in the event of causing damage or injury to another person or property.  Depending on industry, liability insurance can be optional but is highly recommended as facing legal action can be unpredictable and costly.

It also makes sense to protect your assets, revenue and liabilities against potential risks.  There are a wide variety of insurance policies available, so you should take time to consider which are for your business.  Some of the most valuable policies for small businesses are:

Property Insurance:  A property insurance policy can protect your building against damages, theft, fire or vandalism.  If you do not own your building, property insurance also covers valuable assets that you own personal property, including office equipment, computers, inventory or tools you should consider purchasing a policy that will protect you if you have a fire, vandalism, theft, smoke damage etc.

Business Interruption: You may also want to consider business interruption/loss of earning insurance as part of the policy to protect your earnings if the business is unable to operate.

Professional Liability: this type of insurance is also known as Errors and Omissions Insurance. The policy provides defence and damages for failure to or improperly rendering professional services.  Your general liability policy does not provide this protection, so it is important to understand the difference.   Professional liability insurance is applicable for any professional firm including lawyers, accountants, consultants, notaries, real estate agents, architects, hair salons and technology providers to name a few.

Cyber Insurance:  If the business stores sensitive or non-public information about employees or clients on their computers, servers or in paper files they are responsible for protecting that information.  If a breach occurs either electronically or from a paper file a Data Breach policy will provide protection against the loss.

PSC Insurance Brokers specialise in finding insurance solutions for small to medium sized businesses.  Call us today for a confidential discussion on the most appropriate cover for your company.

Disclaimer

Conditions apply for each policy and the information expected from you for a policy to trigger. Coverage may differ based on specific clauses in individual policies. Please ask your broker to explain the additional benefits and exclusions pertaining to your policy.

The information provided is general advice only and does not take account of your personal circumstances or needs. Please refer to our financial services guide which contains details of our services and how we are remunerated.