Business Insurance Newcastle

However, depending on your industry or occupation, other types of business insurance may also be mandatory. For example, accountants, solicitors, tax agents and migration agents are all legally required to hold a certain level of professional indemnity insurance in order to practice their profession in Australia.

Conversely, public liability insurance is often a mandatory licensing requirement for some trade occupations, such as electricians and plumbers in some States.

Some types of insurance may also form part of the requirements to become a member of a professional body or association or be required to comply with contractual obligations.

It’s intended to assist your business to recover from an insured event by paying ongoing expenses (such as wages or rent).

If you believe your business would suffer in the event of unexpected closure, then business interruption insurance could be a great way to safeguard your livelihood.

Theft insurance usually requires the item that’s been stolen to have been securely stored before the theft or for there to be evidence of forcible entry.

While other forms of business insurance are sold through Compare the Market, workers’ compensation is not available through this platform

Generally, business insurance will be a tax-deductible business expense.

Risk factors you might like to consider are the extent of contact you have with your customers or members of the public, the industry you operate in and the type of work you perform, or your contractual obligations to hold this type of insurance.

Smaller home-based businesses may select a lower level of cover if they have limited contact with other people. However, the nature of the business may also be a relevant consideration. For example, a business that produces and/or sells products may select a higher level of cover to protect the business against personal injury or third-party property damage that could arise as a result of those products.

Conversely, businesses that deal with large amounts of foot traffic (bars, live venues, shopping centres, etc.) generally select a higher level of cover. Having close contact with more people increases the chance of an accident, which results in a public liability claim. Contractors and trade workers often require a certain level of cover to meet their contractual obligations or to obtain specific licenses.

Public liability insurance can be a cost-effective way to protect your business against legal expenses associated with public liability claims that could potentially be expensive.

To help decide what types of cover you need and how much to take out, you must identify the risks associated with your business. You could start by thinking about everything that could possibly go wrong, from minor events to worst-case scenarios.

What are the things you need to protect against? How much would it cost to replace all your business assets if they were damaged or destroyed by a fire? What are your possible legal liabilities? How much could it potentially cost if a claim was made against you for third-party injury or property damage, or if you were found negligent of providing misleading or incorrect advice and your client suffered a loss?

Prioritise the risks your business faces by considering:

• The likelihood of the risk occurring
• The extent of damage each risk could cause
• The financial impact it would have on your business

• What types of products do you sell, and could they cause personal injury or third party property damage? For example, do you produce and sell food that could potentially cause food poisoning? Or sell cosmetics that could cause a severe allergic reaction?
• What is the set-up of your market stall like? Do you have electrical cables that somebody could trip over? Do you use big umbrellas that could cause damage if they’re blown over by heavy winds?
• How many people are likely to pass through your stall?

If your stall is responsible for third-party property damage or injury to others, you could be held liable. Something as innocuous as a customer tripping on a misplaced item, or somebody suffering personal injury or illness as a result of the products you sell, may lead to a claim against you, which could incur legal and compensation expenses that could threaten your livelihood.

Online businesses can consider other types of insurance too. For example, if they’re managing customer information digitally, cyber liability insurance may assist in the event of a cyber attack.

An online business can consider:

• Does your online business sell products? If so, your business can still be legally liable for property damage or personal injury caused by the sale of those products (even if you have not manufactured them yourself).
• Does your business provide professional services or advice? Simply providing these services online doesn’t mean you won’t be liable for claims relating to professional negligence or professional misconduct.
• Do you ever meet with clients, partners or suppliers in a face-to-face setting?

What kind of information do you store online? Product information (e.g. schematics, documents), customer data, banking or credit card records? Your business could be compromised if you suffer a data breach as a result of a cyber hack.

Even if there are minimum levels set by your industry body or association, this may not be adequate cover to protect your business against potential claims.

Here are some factors to consider with selecting an appropriate level of cover for your business.

1. The number of employees you have. The more people in your business giving professional advice or performing a professional service, the more likely a mistake could be made and lead to a claim for damages against your business.
2. If you have any high-profile clients or contracts. Giving inaccurate advice is never ideal, but the stakes could be higher when your clients have more to lose. Think about the maximum amount of compensation that could be awarded against you.
3. Your potential legal costs. Legal fees can quickly add up, consider if the level of cover is inclusive or exclusive of defence costs (which include legal fees).

It’s important to note that your public liability policy may not automatically cover any sub-contractors or labour hire workers you take on. Therefore, you may need to elect to have them added to your policy if that’s your intention. This will generally increase your premium, though.

Alternatively, sub-contractors or labour hire workers could be requested to obtain their own public liability insurance policy.

There is often a minimum level of cover stipulated in contracts for working on building sites and other premises.

Visit the Australian Taxation Office (ATO) website for more information and seek advice from your accountant or tax agent.

If the policy covers a claim, public liability insurance can pay for the legal costs along with other expenses involved with the third party’s claim. Learn more about public liability insurance.

If you have customers or suppliers visiting you, even if it’s infrequently, public liability insurance can protect you against the chance that someone suffers an injury on your property. It will also offer protection if you damage another person’s property, whether at your premises or another location.

Even if the risk is minimal, public liability insurance should be considered if your business regularly deals with customers and clients.

Furthermore, some trade industries require employees and subcontractors to have public liability insurance as a condition of their registration or as part of their contractual obligations.

Businesses with a greater number of employees may be seen as a greater risk and more likely to make a claim on their public liability policy. As such, sole traders may find that their premiums are cheaper in comparison.

If they’re found guilty of negligence, which causes injury to a third party or causes damage to the property of others, they may be forced to pay compensation and legal costs out of their own pocket, which may lead to serious financial ramifications. It may also mean that their personal assets are at risk if a claim is made against them.

Public liability insurance may be an inexpensive way to protect a sole trader’s livelihood against third-party personal injury and property damage claims. However, your occupation will also affect the cost of a public liability insurance policy.