Top 5 Insurance Priorities for Small Business

Are you insured against your biggest risks?


Find out the top five areas of your business you should insure

Insuring against the biggest risks in your business is critical for reducing your exposure to potential losses, injuries and legal claims.

Some insurance is compulsory such as workers compensation and some industries have legal requirements for insuring specific parts of a business. You should source information about compulsory insurance that is specific to your industry. You can start with these industry specific fact sheets. You may also like to to consult a peak industry or membership association for your industry

As legislation varies from state to state and countries you should also visit your relevant small business sites to learn about your specific insurance requirements. A list of small business sites in Australia and New Zealand can be found here.

In addition to compulsory insurance there are many other insurance types that may help you manage risk in your business. As a starting point, here are our top 5 insurance priorities you should consider for your small business:

1. The public and people

As mentioned above some insurance is compulsory such as workers compensationIn addition to this you may require public liability insurance. This is to insure against the risk of death, or injury, loss or damage of property at your business premises including your home if you’re a home-based business.

2. Your premises and assets

Several insurance types may be necessary to protect your business premises and assets. These include:

  • Fire
  • Flood
  • Other natural disaster
  • Property (premises, tools, equipment, stock)
  • Motor vehicle (damage and compulsory third party (CTP))
  • Burglary and theft
  • Transit (for transportation of goods).

3. Your operations

You should consider what parts of your operations represent the biggest risk. Insurance types that may be relevant to you include:

  • Professional indemnity – for negligent acts, errors and omissions in the provision of professional advice or services
  • Business interruption – such as loss of profit and additional operating costs incurred as a result of an unplanned event
  • Equipment breakdown – computers and machinery
  • Directors and officers liability – against alleged breaches of duty
  • Employment practices liability – damages and costs resulting from anti-discrimination, unfair dismissal and harassment actions.

4. You and your revenue

It’s important to consider whether you may need insurance to protect you and your revenue in event of injury or illness. These may include income protection, trauma and life insurance.

5. Your products

If you sell products you should consider product liability insurance. Product liability insurance protects against claims of injury or damage caused by products sold or supplied through your business.

What next?

It’s important that you’re not under or overinsured. You need the right type and level of insurance. You should seek several quotes, perhaps speak to an insurance broker specialising in business insurance. You may like to speak to other people in your industry and ask about their personal experience. Carefully consider all of your options. Always ask for the policy in writing and make sure you read and understand the full terms and conditions in the policy disclosure statement.

Please note: The above insurance types may not include everything you may need. You should conduct your own research and gain professional advice where needed. You can visit your relevant small business and industry sites in your state or territory to learn about your specific insurance requirements. A list of small business sites in Australia and New Zealand can be found here.

Don’t forget to check out our 5 Steps to Starting a Business.