There are many risks to starting up your own business, as any entrepreneur can confidently tell you. It’s an unavoidable part of the deal. However, there are enough benefits to outweigh the negatives, which is how there can be over 2.2 million currently trading businesses in Australia alone. Every day, someone is starting up a new venture and accepting all the potential pitfalls that may accompany that decision.
Luckily, with the amount of affordable and effective business insurance plans on the market these days, entrepreneurs can start businesses safely knowing that they will be protected if anything takes a left turn. That being said, not all plans and policies are the same. There are various types of business insurance available suited to each company’s specific needs. The size of your company, industry you work within, way that you interact with clients or customers and many other factors will determine which type of business insurance is best for you.
Here are some of the most common types and why they might be right for your business:
- General Liability Insurance
This is a wide-reaching type of insurance that covers all low-level corporate risks. Typically, general liability coverage includes protection against claims of third-party accidents, injuries, negligence or faulty products. It also protects your commercial property in instances of property damage and can cover some medical expenses. General liability is beneficial for businesses of all sizes, as absorbing the cost of liability can cause a major impact on both your finances and your reputation.
- Professional Liability Insurance
This is also commonly referred to as Errors and Omissions (E&O) Insurance, and is primarily used to cover court costs for any third-party claims of professional malpractice. If, for any reason, your business is unable to carry out a service or if a client blames you for a contract breach, E&O insurance can minimise your liability. Medical and legal professionals are especially susceptible to claims of this nature, and can greatly benefit from liability insurance as an added level of security when dealing with clients.
- Business Interruption (BI) Insurance
While larger businesses may be able to handle complications that hinder their flow of income, smaller businesses can take a hard hit when anything goes wrong. This is where BI insurance comes in. It covers lost profit due to unforeseen hardships such as natural disasters, necessary renovations, power or electrical outages, and the like. It also enables business owners to pay and retain staff while they are unable to function as usual.
- Workers Compensation
Workers compensation insurance protects you and your employees in the event of workplace accidents or injuries. If any incident occurs on the job, workers compensation will protect you from liability and will also provide financial support for the medical treatment and/or sick leave of the affected employee. Workers compensation is especially important for companies who work with heavy machinery or require employee mobility in an form (such as roofers, construction workers, mechanics, etc) although it is useful across all fields.
- Commercial Property Insurance
Property in Melbourne is not cheap- Especially in the inner city, where many businesses are based. Therefore, it’s essential to make sure your property is protected so you don’t lose vital funds if any damage takes place. Commercial property insurance can protect your building in the case of a fire, explosion, flood or similar situation. Certain insurance plans also include coverage of intentional third-party damage such as broken windows or other forms of vandalism. Commercial property insurance is the best way to keep your building in good form and make sure it maintains a professional look for customers.
- Commercial Vehicle Insurance
Car insurance is important enough when you are the sole person driving your vehicle, but it’s even more important when others will be behind the wheel. Commercial auto insurance is a must-have for businesses who use cars for professional purposes, whether they are delivering large amounts of goods, lending small cars to employees for personal transport purposes, or driving around customers. Vehicle insurance can help protect your car if any damage occurs, whether it’s a major accident or minor aesthetic issue. It also supports drivers and passengers if they are injured while driving, and can protect you from associated liability as well.
We recognise that this is a lot of information to take in⎼ Especially if you are new to the world of business insurance. If this is the case, we urge you to get in touch with a local insurance broker who can provide professional advice on which types of business insurance are best suited for you. The day-to-day happenings of any business can fluctuate a lot over time, meaning coverage needs are always changing. Whether you are just starting up a business for the first time or you’ve owned a company for many years, it’s never a bad time to reassess your options and update your current insurance policy if needed.